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PSA with Public Trust Advisors, LLC
Z022 —. 319 1 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 3 DocuSign Envelope ID:5ECAF647-4001-47BE-8E76-B11BC78046E4 I/2Ad/ZZ. C CO Contract no.21-264-01 PROFESSIONAL SERVICES AGREEMENT BETWEEN THE CITY OF MIAMI BEACH AND PUBLIC TRUST ADVISORS, LLC FOR INVESTMENT ADVISORY SERVICES PURSUANT TO RFQ-2021-264-KB 9/16/2022 1 11:40 EDT This Professional Services Agreement ("Agreement") is entered into this ("Effective Date"), between the CITY OF MIAMI BEACH, FLORIDA, a municipal corporation organized and existing under the laws of the State of Florida, having its principal offices at 1700 Convention Center Drive, Miami Beach, Florida, 33139 (the "City'), and PUBLIC TRUST ADVISORS, LLC a Colorado Limited Liability Company whose address is 717 17'h Street, Suite 1850, Denver, Colorado 80202("Consultant"). SECTION 1 DEFINITIONS Agreement: This Agreement between the City and Consultant, including any exhibits and amendments thereto. City Manager: The chief administrative officer of the City. City Manager's Designee: The City staff member who is designated by the City Manager to administer this Agreement on behalf of the City. The City Manager's designee shall be John Woodruff, Chief Financial Officer. Consultant: For the purposes of this Agreement, Consultant shall be deemed to be an independent Consultant,and not an agent or employee of the City. Services: All services,work and actions by the Consultant performed or undertaken pursuant to the Agreement. Fee: Amount paid to the Consultant as compensation for Services. Proposal Documents:Proposal Documents shall mean City of Miami Beach RFQ No. 2021- 264-KB for Investment Advisory Services together with all amendments thereto, issued by the City In contemplation of this Agreement (the "RFQ"), and the Consultant's proposal in response thereto ("Proposal"), all of which are hereby Incorporated and made a part hereof; provided, however, that in the event of an express conflict between the Proposal Documents and this Agreement, the following.order of precedent shall prevail:this Agreement;the RFQ and the Proposal. 1 fi DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647-40D1-47BE-8E76-B11BC7B046E4 Contract no.21-264-01 Risk Manager: The Risk Manager of the City, with offices at 1700 Convention Center Drive, Third Floor, Miami Beach, Florida 33139; telephone number(305) 673-7000, Ext.6435;and fax number(305)673-7023. SECTION 2 SCOPE OF SERVICES 2.1 Consultant shall provide the City with non-discretionary investment advisory services to make recommendation for the City's investments and direct the City's investments, as further detailed in Exhibit"A"attached here to(the"Services"). SECTION 3 TERM The term of this Agreement ("Term") shall commence upon execution of this Agreement by all parties hereto(the Effective Date set forth on p. 1 hereof),and shall have an initial term of three (3)years with two(2)additional two-year renewal options, to be exercised at the City Manager's sole option and discretion, by providing Consultant with written notice of same no less than thirty (30)days prior to the expiration of The initial term. SECTION 4 FEE 4.1 In consideration of the Services to be provided, Consultant shall be compensated and pay fees based on the details attached hereto as Exhibit"B". 4.2 INVOICING Upon receipt of an acceptable and approved invoice, payment(s)shall be made within forty-five (45) days for that portion (or those portions) of the Services satisfactorily rendered (and referenced in the particular invoice). Invoices shall include.a detailed description of the Services (or portions thereof) provided, and shall be submitted to the City at the following address: Accounts Payable: Pavables a(�.miamibeachfl.gov SECTION 5 TERMINATION 5.1 TERMINATION FOR CAUSE If the Consultant shall fail to fulfill in a timely manner, or otherwise violates, any of the covenants, agreements, or stipulations material to this Agreement, the City, through its City Manager, shall thereupon have the right to terminate this Agreement for cause. Prior to exercising its option to terminate for cause, the City shall notify the Consultant of its violation of 2 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647-4001.478E-8E76-811BC7B046E4 Contract no.21-264-01 the particular term(s) of this Agreement and shall grant Consultant ten (10) days to cure such default. If such default remains uncured after ten (10) days, the City may terminate this Agreement without further notice to Consultant. Upon termination, the City shall be fully discharged from any and all liabilities, duties, and terms arising out of, or by virtue of, this Agreement. Notwithstanding the above, the Consultant shall not be relieved of liability to the City for damages sustained by the City by any breach of the Agreement by the Consultant. The City,at its sole option and discretion, shall be entitled to bring any and all legal/equitable actions that it deems to be in its best interest in order to enforce the City's rights and remedies against Consultant. The City shall be entitled to recover all costs of such actions, including reasonable attorneys'fees. 5,2 TERMINATION FOR CONVENIENCE OF THE CITY THE CITY MAY ALSO, THROUGH ITS CITY MANAGER, AND FOR ITS CONVENIENCE AND WITHOUT CAUSE, TERMINATE THE AGREEMENT AT ANY TIME DURING THE TERM BY GIVING WRITTEN NOTICE TO CONSULTANT OF SUCH TERMINATION, WHICH SHALL BECOME EFFECTIVE WITHIN THIRTY (30) DAYS FOLLOWING RECEIPT BY THE CONSULTANT OF SUCH NOTICE. ADDITIONALLY, IN THE EVENT OF A PUBLIC HEALTH, WELFARE OR SAFETY CONCERN, AS DETERMINED BY THE CITY MANAGER, IN THE CITY MANAGER'S SOLE DISCRETION, THE CITY MANAGER, PURSUANT TO A VERBAL OR WRITTEN NOTIFICATION TO CONSULTANT, MAY IMMEDIATELY SUSPEND THE SERVICES UNDER THIS AGREEMENT FOR A TIME CERTAIN, OR IN THE ALTERNATIVE, TERMINATE THIS AGREEMENT ON A GIVEN DATE. IF THE AGREEMENT IS TERMINATED FOR CONVENIENCE BY THE CITY, CONSULTANT SHALL BE PAID FOR ANY SERVICES SATISFACTORILY PERFORMED UP TO THE DATE OF TERMINATION; FOLLOWING WHICH THE CITY SHALL BE DISCHARGED FROM ANY AND ALL LIABILITIES, DUTIES,AND TERMS ARISING OUT OF, OR BY VIRTUE OF,THIS AGREEMENT. 5.3 TERMINATION FOR INSOLVENCY The City also reserves the right to terminate the Agreement in the event the Consultant is placed either in voluntary or involuntary bankruptcy or makes an assignment for the benefit of creditors. in such event, the right and obligations for the parties shall be the same as provided for in Section 5.2. SECTION 6 INDEMNIFICATION AND INSURANCE REQUIREMENTS 6.1 INDEMNIFICATION Consultant agrees to indemnify, defend and hold harmless the City of Miami Beach and its officers, employees, agents, and Consultants, from and against any and all actions (whether at law or in equity), claims, liabilities, losses, and expenses,including, but not limited to, attorneys' fees and costs, for personal, economic or bodily injury, wrongful death, loss of or damage to property, which may arise or be alleged to have arisen from the negligent acts, errors, omissions or other wrongful conduct of the Consultant, its officers, employees, agents, 3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647-4001-47BE-8E76-B11BC7B046E4 ( Contract no.21-264-01 Consultants, or any other person or entity acting under Consultant's control or supervision, In connection with, related to, or as a result of the Consultant's performance of the Services pursuant to this Agreement. To that extent, the Consultant shall pay all such claims and losses and shall pay all such costs and judgments which may issue from any lawsuit arising from such claims and losses and shall pay all costs and attorneys' fees expended by the City in the defense of such claims and losses, including appeals. The Consultant expressly understands and agrees that any insurance protection required by this Agreement or otherwise provided by the Consultant shall in no way limit the Consultant's responsibility to indemnify, keep and save harmless and defend the City or its officers, employees, agents and instrumentalities as herein provided. The parties agree that one percent (1%) of the total compensation to Consultant for performance of the Services under this Agreement is the specific consideration from the City to the Consultant for the Consultant's indemnity agreement. The provisions of this Section 6.1 and of this indemnification shall survive termination or expiration of this Agreement. 6.2 INSURANCE REQUIREMENTS 6.2.1 The Consultant shall maintain the below required insurance in effect prior to awarding the agreement and for the duration of the agreement. The maintenance of proper insurance coverage is a material element of the agreement and failure to maintain or renew coverage may be treated as a material breach of the contract,which could result in withholding of payments or termination of the Agreement. A. Workers' Compensation Insurance for all employees of the Consultant as required by Florida Statute Chapter 440 and Employer Liability Insurance with a limit of no less than $1,000,000 per accident for bodily injury or disease. Should the Consultant be exempt from this Statute, the Consultant and each employee shall hold the City harmless from any injury incurred during performance of the Contract. The exempt Consultant shall also submit (i) a written statement detailing the number of employees and that they are not required to carry Workers' Compensation insurance and do not anticipate hiring any additional employees during the term of this contract or (ii) a copy of a Certificate of Exemption. B. Commercial General Liability Insurance on an occurrence basis, including products and completed operations, property damage, bodily injury and personal & advertising injury with limits no less than $1,000,000 per occurrence, and $2,000,000 general aggregate. C. Automobile Liability Insurance covering any automobile, if vendor has no owned automobiles, then coverage for hired and non-owned automobiles, with limit no less than $1,000,000 combined per accident for bodily injury and property damage. D. Professional Liability (Errors & Omissions) Insurance appropriate to the Consultant's profession,with limit no less than$1,000,000. 6.2.2 Additional Insured — City of Miami Beach must be included by endorsement as an additional insured with respect to all liability policies (except Professional Liability and Workers' 4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647-40D1-47BE-8E76-1311BC7B046E4 Contract no.21-264-0I = Compensation) arising out of work or operations performed on behalf of the Consultant including materials, parts, or equipment furnished in connection with such work or operations and automobiles owned, leased, hired or borrowed in the form of an endorsement to the Consultant's insurance. 6.2.3 Notice of Cancellation — Each insurance policy required above shall provide that coverage shall not be cancelled, except with notice to the City of Miami Beach do EXIGIS Insurance Compliance Services. 6.2.4 Waiver of Subrogation — Consultant agrees to obtain any endorsement that may be necessary to affect the waiver of subrogation on the coverages required. However, this provision applies regardless of whether the City has received a waiver of subrogation endorsement from the insurer. 6.2.5 Acceptability of Insurers—Insurance must be placed with insurers with a current A.M. Best rating of A:VII or higher. If not rated, exceptions may be made for members of the Florida Insurance Funds (i.e. FWCIGA, FAJUA). Carriers may also be considered if they are licensed and authorized to do insurance business in the State of Florida. 6.2.6 Verification of Coverage—Consultant shall furnish the City with original certificates and amendatory endorsements, or copies of the applicable insurance language, effecting coverage required by this contract. All certificates and endorsements are to be received and approved by the City before work commences. However, failure to obtain the required documents prior to the work beginning shall not waive the Consultant's obligation to provide them. The City reserves the right to require complete, certified copies of all required insurance policies, including endorsements,required by these specifications, at any time. CERTIFICATE HOLDER ON ALL COI MUST READ: CITY OF MIAMI BEACH c/o EXIGIS Insurance Compliance Services P.O. Box 947 Murrieta, CA 92564 Kindly submit all certificates of insurance, endorsements, exemption letters to our servicing agent, EXIGIS,at: Certificates-miamibeachaa.riskworks.com 6.2.7 Special Risks or Circumstances — The City of Miami Beach reserves the right to modify these requirements, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances. Compliance with the foregoing requirements shall not relieve the vendor of his liability and obligation under this section or under any other section of this agreement. SECTION 7 LITIGATION JURISDICTIONNENUE/JURY TRIAL WAIVER This Agreement shall be construed in accordance with the laws of the State of Florida. This Agreement shall be enforceable in Miami-Dade County, Florida, and if legal action is necessary 5 DocuSign Envelope ID:68A084C7-63AF-4907-924A-SE3C31B1A2C0 DocuSign Envelope ID:5ECAF647-40D1-478E-SE76-811BC76046E4 Contract no.21-264-01 by either party with respect to the enforcement of any or all of the terms or conditions herein, exclusive venue for the enforcement of same shall lie in Miami-Dade County, Florida. By entering into this Agreement, Consultant and the City expressly waive any rights either party may have to a trial by jury of any civil litigation related to or arising out of this Agreement. SECTION 8 LIMITATION OF CITY'S LIABILITY The City desires to enter into this Agreement only if in so doing the City can place a limit on the City's liability for any cause of action, for money damages due to an alleged breach by the City of this Agreement, so that its liability for any such breach never exceeds the sum of$10,000. Consultant hereby expresses its willingness to enter into this Agreement with Consultant's recovery from the City for any damage action for breach of contract to be limited to a maximum amount of$10,000. Accordingly, and notwithstanding any other term or condition of this Agreement, Consultant hereby agrees that the City shall not be liable to the Consultant for damages in an amount in excess of$10,000 for any action or claim for breach of contract arising out of the performance or non-performance of any obligations imposed upon the City by this Agreement. Nothing contained in this section or elsewhere in this Agreement is in any way intended to be a waiver of the limitation placed upon the City's liability, as set forth in Section 768.28, Florida Statutes. SECTION 9 DUTY OF CARE/COMPLIANCE WITH APPLICABLE LAWS/PATENT RIGHTS; COPYRIGHT;. AND CONFIDENTIAL FINDINGS 9.1 DUTY OF CARE With respect to the performance of the Services contemplated herein, Consultant shall exercise that degree of skill, care, efficiency and diligence normally exercised by reasonable persons and/or recognized professionals with respect to the performance of comparable work and/or services. 9.2 COMPLIANCE WITH APPLICABLE LAWS In its performance of the Services, Consultant shall comply with all applicable laws, ordinances, and regulations of the City, Miami-Dade County, the State of Florida, and the federal government,as applicable. 9.3 PATENT RIGHTS; COPYRIGHT; CONFIDENTIAL FINDINGS Any work product arising out of this Agreement, as well as, all information specifications, processes, data and findings,are intended to be the property of the City and shall not otherwise be made public and/or disseminated by Consultant, without the prior written consent of the City Manager, excepting any information, records etc.which are required to be disclosed pursuant to Court Order and/or Florida Public Records Law. 6 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 } DocuSign Envelope ID:5ECAF647-40D1-47BE-8E76-B11BC7B046E4 Contract no.21-264-01 All reports, documents, articles, devices, and/or work produced in whole or in part under this Agreement are intended to be the sole and exclusive property of the City and shall not be subject to any application for copyright or patent by or on behalf of the Consultant or its employees or sub-consultants,without the prior written consent of the City Manager. SECTION 10 GENERAL PROVISIONS 10.1 AUDIT AND INSPECTIONS Upon reasonable verbal or written notice to Consultant, and at any time during normal business hours (I.e. 9AM — 5PM, Monday through Fridays, excluding nationally recognized holidays), and as often as the City Manager may, in his/her reasonable discretion and judgment, deem necessary, there shall be made available to the City Manager, and/or such representatives as the City Manager may deem to act on the City's behalf, to audit, examine, and/or inspect, any and all other documents and/or records relating to all matters covered by this Agreement. Consultant shall maintain any and all such records at its place of business at the address set forth in the"Notices"section of this Agreement 10.2 INSPECTOR GENERAL AUDIT RIGHTS (A) Pursuant to Section 2-256 of the Code of the City of Miami Beach, the City has established the Office of the Inspector General which may, on a random basis, perform reviews, audits, inspections and investigations on all City contracts, throughout the duration of said contracts. This random audit is separate and distinct from any other audit performed by or on behalf of the City. (B) The Office of the Inspector General is authorized to investigate City affairs and empowered to review past, present and proposed City programs, accounts, records, contracts and transactions. In addition, the Inspector General has the power to subpoena witnesses, administer oaths, require the production of witnesses and monitor City projects and programs. Monitoring of an existing City project or program may include a report concerning whether the project is on time, within budget and in conformance with the contract documents and applicable law. The Inspector_General shall have the power to audit, investigate, monitor, oversee, inspect and review operations, activities, performance and procurement process including but not limited to project design, bid specifications, (bid/proposal) submittals, activities of the Consultant, its officers, agents and employees, lobbyists, City staff and elected officials to ensure compliance with the contract documents and to detect fraud and corruption. Pursuant to Section 2-378 of the City Code, the City is allocating a percentage of its overall annual contract expenditures to fund the activities and operations of the Office of Inspector General. (C) Upon ten (10) days written notice to the Consultant, the Consultant shall make all requested records and documents available to the Inspector General for inspection and copying. The Inspector General is empowered to retain the services of independent private sector auditors to audit, investigate, monitor, oversee, inspect and review 7 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647-40D1-47BE-8E76-B11BC7B046E4 Contract no.21-264-01 operations activities, performance and procurement process including but not limited to 1 project design, bid specifications, (bid/proposal) submittals, activities of the Consultant its officers, agents and employees, lobbyists, City staff and elected officials to ensure compliance with the contract documents and to detect fraud and corruption. (D) The Inspector General shall have the right to inspect and copy all documents and records in the Consultant's possession, custody or control which in the Inspector General's sole judgment, pertain to performance of the contract, including, but not limited to original estimate files, change order estimate files, worksheets, proposals and agreements from and with successful subconsultants and suppliers, all project-related correspondence, memoranda, instructions, financial documents, construction documents, (bid/proposal) and contract documents, back-change documents, all documents and records which involve cash, trade or volume discounts, insurance proceeds, rebates, or dividends received, payroll and personnel records and supporting documentation for the aforesaid documents and records. (E) The Consultant shall make available at its office at all reasonable times the records, materials, and other evidence regarding the acquisition (bid preparation) and performance of this Agreement, for examination, audit, or reproduction, until three (3) years after final payment under this Agreement or for any longer period required by statute or by other clauses of this Agreement. In addition: i. If this Agreement is completely or partially terminated, the Consultant shall make available records relating to the work terminated until three (3) years after any resulting final termination settlement;and ii. The Consultant shall make available records relating to appeals or to litigation or the settlement of claims arising under or relating to this Agreement until such appeals,litigation,or claims are finally resolved. (F) The provisions in this section shall apply to the Consultant, its officers, agents, employees, subconsultants and suppliers. The Consultant shall incorporate the provisions in this section in all subcontracts and all other agreements executed by the Consultant in connection with the performance of this Agreement. (G) Nothing in this section shall impair any independent right to the City to conduct audits or investigative activities. The provisions of this section are neither intended nor shall they be construed to impose any liability on the City by the Consultant or third parties. 10.3 ASSIGNMENT,TRANSFER OR SUBCONSULTING Consultant shall not subcontract, assign, or transfer all or any portion of any work and/or service under this Agreement without the prior written consent of the City Manager, which consent, if given at all, shall be in the Manager's sole judgment and discretion. Neither this Agreement, nor any term or provision hereof, or right hereunder,shall be assignable unless as approved pursuant to this section, and any attempt to make such assignment (unless approved)shall be void. 8 i DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647-40D1-47BE-8E76-B11BC713046E4 Contract no.21-264-01 10.4 PUBLIC ENTITY CRIMES Prior to commencement of the Services, the Consultant shall file a State of Florida Form Pit 7068, Sworn Statement under Section 287.133(3)(a) Florida Statute on Public Entity Crimes with the City's Procurement Division. 10.5 NO DISCRIMINATION In connection with the performance of the Services, the Consultant shall not exclude from participation in, deny the benefits of, or subject to discrimination anyone on the grounds of race, color, national origin, sex,age,disability, religion, income or family status. Additionally, Consultant shall comply fully with the City of Miami Beach Human Rights Ordinance, codified in Chapter 62 of the City Code, as may be amended from time to time, prohibiting discrimination in employment, housing, public accommodations, and public services on account of actual or perceived race, color, national origin, religion, sex, intersexuality, gender identity, sexual orientation, marital and familial status, age, disability, ancestry, height, weight, domestic partner status, labor organization membership, familial situation,or political affiliation. 10.6 CONFLICT OF INTEREST Consultant herein agrees to adhere to and be governed by all. applicable Miami-Dade County Conflict of Interest Ordinances and Ethics provisions, as set forth in the Miami-Dade County Code, as may be amended from time to time; and by the City of Miami Beach Charter and Code, as may be amended from time to time; both of which are incorporated by reference as if fully set forth herein. Consultant covenants that it presently has no interest and shall not acquire any interest, directly or indirectly,which could conflict in any manner or degree with the performance of the Services. Consultant further covenants that in the performance of this Agreement, Consultant shall not employ any person having any such interest. No member of or delegate to the Congress of the United States shall be admitted to any share or part of this Agreement or to aty benefits arising therefrom. 10.7 CONSULTANT'S COMPLIANCE WITH FLORIDA PUBLIC RECORDS LAW (A) Consultant shall comply with Florida Public Records law under Chapter 119, Florida Statutes, as may be amended from time to time. (B) The term"public records"shall have the meaning set forth in Section 119.011(12),which means all documents, papers, letters, maps, books, tapes, photographs, films, sound recordings, data processing software, or other material, regardless of the physical form, characteristics, or means of transmission, made or received pursuant to law or ordinance or in connection with the transaction of official business of the City. (C) Pursuant to Section 119.0701 of the Florida Statutes, if the Consultant meets the definition of"Contractor"as defined in Section 119.0701(1)(a), the Consultant shall: (1) Keep and maintain public records required by the City to perform the service; (2) Upon request from the City's custodian of public records, provide the City with a 9 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647.40D1-47BE-8E76-B11BC7B046E4 Contract no.21-264-01 copy of the requested records or allow the records to be inspected or copied within a reasonable time at a cost that does not exceed the cost provided in Chapter 119, Florida Statutes or as otherwise provided by law; (3) Ensure that public records that are exempt or confidential and exempt from public records disclosure requirements are not disclosed, except as authorized by law, for the duration of the contract term and following completion of the Agreement if the Consultant does not transfer the records to the City; (4) Upon completion of the Agreement, transfer, at no cost to the City, all public records in possession of the Consultant or keep and maintain public records required by the City to perform the service. If the Consultant transfers all public records to the City upon completion of the Agreement, the Consultant shall destroy any duplicate public records that are exempt or confidential and exempt from public records disclosure requirements. If the Consultant keeps and maintains public records upon completion of the Agreement, the Consultant shall meet all applicable requirements for retaining public records. All records stored electronically must be provided to the City, upon request from the City's custodian of public records, in a format that is compatible with the information technology systems of the City. (D) REQUEST FOR RECORDS; NONCOMPLIANCE. (1) A request to inspect or copy public records relating to the City's contract for services must be made directly to the City. If the City does not possess the requested records, the City shall immediately notify the Consultant of the • request, and the Consultant must provide the records to the City or allow the records to be inspected or copied within a reasonable time. (2) Consultant's failure to comply with the City's request for records shall constitute a breach of this Agreement, and the City,at its sole discretion, may: (1) unilaterally terminate the Agreement; (2) avail itself of the remedies set forth under the Agreement;and/or(3)avail itself of any available remedies at law or in equity. (3) A Consultant who fails to provide the public records to the City within a reasonable time may be subject to penalties under s. 119.10. (E) CIVIL ACTION. (1) If a civil action is filed against a Consultant to compel production of public records relating to the City's contract for services, the court shall assess and award against the Consultant the reasonable costs of enforcement, including reasonable attorneys'fees, If: a. The court determines that the Consultant unlawfully refused to comply with the public records request within a reasonable time;and b. At least 8 business days before filing the action, the plaintiff provided written notice of the public records request, including a statement that the Consultant has not complied with the request, to the City and to the Consultant. (2) A notice complies with subparagraph (1)(b) if it is sent to the City's custodian of public records and to the Consultant at the Consultant's address listed on its contract with the City or to the Consultant's registered agent. Such notices must be sent by common carrier delivery service or by registered, Global Express Guaranteed, or certified mail, with postage or shipping paid by the sender and with evidence of delivery,which may be in an electronic format. (3) A Consultant who complies with a public records request within 8 business days after the notice is sent is not liable for the reasonable costs of enforcement. 10 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF64740D1.47BE-8E76-B1113C73Q46E4 Contract no.21-264-01 ,((F)' IF THE CONSULTANT HAS QUESTIONS 'REGARDING THE APPLICATION OF CHAPTER 119, FLORIDA STATUTES, TO THE CONSULTANT'S DUTY TO PROVIDE PUBLIC RECORDS RELATING TO THIS AGREEMENT, CONTACT THE CUSTODIAN OF PUBLIC RECORDS AT: CITY OF MIAMI BEACH ATTENTION: RAFAEL E. GRANADO, CITY CLERK 1700 CONVENTION CENTER DRIVE MIAMI BEACH, FLORIDA 33139 .E-MAIL: RAFAELGRANADO a(7,MIAMIBEACHFL.GOV PHONE: 305-673-7411 10.8 FORCE MAJEURE • (A) A"Force Majeure"event is an event that(i)in fact causes a delay in the performance of the'Consultant or the City's obligations under the Agreement, and (ii)is beyond the reasonable control of such party unable to perform the obligation, and (iii) is not due to. an intentional.act, error, omission,.or negligence of such'party,.and (iv) could.net have. reasonably been foreseen and 'prepared f'or by such party at any'time prior to the occurrence of the event. Subject to the foregoing criteria, Force Majeure may include events such as war, civil insurrection, riot, fires, epidemics, pandemics, terrorism, sabotage, explosions, embargo restrictions, quarantine restrictions, transportation accidents, strikes; strong hurricanes or tornadoes, earthquakes,'or other acts of. God which prevent performance. Force Majeure shall not include technological impossibility, inclement weather,. or failure to-:secure any of the required permits pursuant to the Agreement. (B) If the City or Consultant's performance of its contractual obligations is prevented or delayed by an event believed by to be Force Majeure, ,such party shall immediately, upon learning of the occurrence of the event or of the commencement deny such delay, but in any case within fifteen (15) business days thereof, provide notice: (i) of the occurrence of event of Force Majeure, (ii) of the nature of the event and the cause thereof, (iii) of the anticipated impact on the Agreement, (iv) of the anticipated period of the delay, and (v) of what course of action such party plans to take in order to mitigate the detrimental effects of the event. The timely delivery of the notice of the occurrence of a Force Majeure event is a condition precedent to allowance of any relief pursuant to this section; however, receipt of such notice shall not constitute acceptance that the event claimed to be a Force Majeure event is in fact Force Majeure, and the burden of proof of the occurrence of a Force Majeure event shall be on the requesting party. (C) No party hereto shall be liable for its failure to carry out its obligations under the Agreement during a period when such party is rendered unable, in whole or in part, by Force Majeure to carry out such obligations. The suspension of any.of the obligations under this Agreement due to a Force Majeure event shall be of no greater scope and no longer duration than is required. The party shall use its reasonable best efforts to continue to perform its obligations hereunder to the extent such obligations are not 11 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647-40D1-47BE-8E76-B11BC7B046E4 Contract no.21-264-01 affected or are only partially affected by the Force Majeure event, and to correct or cure the event or condition excusing performance and otherwise to remedy its inability to perform to the extent its inability to perform is the direct result of the Force Majeure event with all reasonable dispatch. (D) Obligations pursuant to the Agreement that arose before the occurrence of a Force Majeure event, causing the suspension of performance,shall not be excused as a result of such occurrence unless such occurrence makes such performance not reasonably possible. The obligation to pay money in a timely manner for obligations and liabilities which matured prior to the occurrence of a Force Majeure event shall not be subject to the Force Majeure provisions. (E) Notwithstanding any other provision to the contrary herein, in the event of a Force Majeure occurrence, the City may, at the sole discretion of the City Manager, suspend the City's payment obligations under the Agreement, and may take such action without regard to the notice requirements herein. Additionally, in the event that an event of Force Majeure delays a party's performance under the Agreement for a time period greater than thirty (30) days, the City may, at the sole discretion of the City Manager, terminate the Agreement on a given date, by giving written notice to Consultant of such termination. If the Agreement is terminated pursuant to this section, Consultant shall be paid for any Services satisfactorily performed up to the date of termination; following which the City shall be discharged from any and all liabilities, duties, and terms arising out of, or by virtue of, this Agreement. In no event will any condition of Force Majeure extend this Agreement beyond its stated term. 10.9 E-VERIFY (A) Consultant shall comply with Section 448.095, Florida Statutes, "Employment Eligibility" ("E-Verify Statute"), as may be amended from time to time. Pursuant to the E-Verify Statute, commencing on January 1, 2021, Consultant shall register with and use the E- Verify system to verify the work authorization status of all newly hired employees during the Term of the Agreement. Additionally, Consultant shall expressly require any subconsultant performing work or providing services pursuant to the Agreement to likewise utilize the U.S. Department of Homeland Security's E-Verify system to verify the employment eligibility of all new employees hired by the subconsuitant during the contract Term. If Consultant enters Into a contract with an approved subconsultant, the subconsultant must provide the Consultant with an affidavit stating that the subconsultant does not employ, contract with, or subcontract with an unauthorized alien. Consultant shall maintain a copy of such affidavit for the duration of the Agreement,or such other extended period as may be required under this Agreement. (B) TERMINATION RIGHTS. (1) If the City has a good faith belief that Consultant has knowingly violated Section 448.09(1), Florida Statutes, the City shall terminate this Agreement with Consultant for cause, and the City shall thereafter have or owe no further obligation or liability to Consultant. (2) If the City has a good faith belief that a subconsultant has knowingly violated the foregoing Subsection 10.9(A), but the Consultant otherwise complied with such subsection, the City will promptly notify the Consultant and order the Consultant to Immediately terminate the Agreement with the subconsultant. Consultant's failure to terminate a subconsultant shall be an event of default under this 12 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647.40D1-47BE-8E76-B11BC7B046E4 Contract no.21-264-01 Agreement, entitling City to terminate this Agreement for cause. (3) A contract terminated under the foregoing Subsection (8)(1) or (B)(2) is not in breach of contract and may not be considered as such. (4) The City or Consultant or a subconsultant may file an action with the Circuit or County Court to challenge a termination under the foregoing Subsection (B)(1)or (B)(2) no later than 20 calendar days after the date on which the contract was terminated. (5) If the City terminates the Agreement with Consultant under the foregoing Subsection(B)(1), Consultant may not be awarded a public contract for at least 1 year after the date of termination of this Agreement. (6) Consultant is liable for any additional costs incurred by the City as a result of the termination of this Agreement under this Section 10.9 10.10 BACKGROUND CHECKS The Consultant shall conduct a full criminal background check at its own expense on each of its employees engaged in providing Services under this RFQ or any resulting Agreement prior to the commencement of said Services. Any Consultant employee eligible to perform work pursuant to this RFQ, or resulting Agreement, shall require the prior approval of the HR Department if he or she: (1) has been convicted of or was placed in a pre-trial diversion program for any crime involving dishonesty or breach of trust; embezzlement; drug trafficking; forgery; burglary; robbery; theft; perjury; possession of stolen property; identity theft; fraud; money laundering; shoplifting; larceny; falsification of documents and/or(2) has been convicted.of any sex, weapons, or violent crime including but not limited to homicide; attempted homicide; rape; child molestation; extortion; terrorism or terrorist threats; kidnapping; assault; battery; and • illegal weapon possession,sale or use. The Consultant shall defend, indemnify and hold the City, its officers, employees, and agents harmless from and against any and all liability, loss, expense (including reasonable attorney's fees) or claims for injury or damages arising out of its failure to comply with this requirement. The Consultant shall employ personnel competent to perform the work specified herein. The City reserves the right to request the removal of the Consultant's employee's from performing maintenance on the City's grounds where the employee's performance or actions are obviously detrimental to the Services. Consultant's personnel must wear photo identifications at all times. SECTION 11 NOTICES Until changed by notice,in writing, all such notices and communications shall be addressed as follows: TO CONSULTANT: Public Trust Advisors, LLC John F. Grady 717 17th Street,Suite 1850 Denver, CO 80202 Ph: 407-588-0525/866-616-3949 Email:john.grady@publictrustadvisors.com 13 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647-40D1-47BE-8E76-B11BC7B046E4 Contract no.21-264-01 • TO CITY: City of Miami Beach Finance Department John Woodruff 1700 Convention Center Drive Miami Beach, FL 33139 Ph: 305-673-7466 Email:johnwoodruff@miamibeachfl.gov All notices mailed electronically to either party shall be deemed to be sufficiently transmitted. SECTION 12 MISCELLANEOUS PROVISIONS 12.1 CHANGES AND ADDITIONS This Agreement cannot be modified or amended without the express written consent of the parties. No modification, amendment, or alteration of the terms or conditions contained herein shall be effective unless contained in a written document executed with the same formality and of equal dignity herewith. 12.2 SEVERABILITY If any term or provision of this Agreement is held invalid or unenforceable, the remainder of this Agreement shall not be affected, and every other term and provision of this Agreement shall be valid and be enforced to the fullest extent permitted by law. 12.3 WAIVER OF BREACH A party's failure to enforce any provision of this Agreement shall not be deemed a waiver of such provision or modification of this Agreement. A party's waiver of any breach of a provision of this Agreement shall not be deemed a waiver of any subsequent breach and shall not be construed to be a modification of the terms of this Agreement. 12.4 JOINT PREPARATION The parties hereto acknowledge that they have sought and received whatever competent advice and counsel as was necessary for them to form a full and complete understanding of all rights and obligations herein and that the preparation of this Agreement has been a joint effort of the parties, the language has been agreed to by parties to express their mutual intent and the resulting document shall not, solely as a matter of judicial construction, be construed more severely against one of the parties than the other. 12.5 ENTIRETY OF AGREEMENT The City and Consultant agree that this is the entire agreement between the parties. This Agreement supersedes all prior negotiations, correspondence, conversations, agreements or understandings applicable to the matters contained herein, and there are no commitments, 14 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647-40D1-47BE-8E76-B11BC7B046E4 Contract no.21-264-01 agreements or understandings concerning the subject matter of this Agreement that are not contained in this document. Title and paragraph headings are for convenient reference and are not intended to confer any rights or obligations upon the parties to this Agreement. [REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK] 15 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelops ID:I GAF647-40Di-41BE-BE15 B11BGT048E4 Contract no.21-264-01 IN,WITNESS WHEREOF,the padies hereto,have caused this Agreement to be executed by their appropriate officials,as of the date first entered above. FOR CITY:. CITY OF MIAMI BEACH, FLORIDA • ATTEST: DocuSignedd by: /� By: etfatl, Gr'aa4 reek FA 8 0 �FSSt4(:h. . a ae�Iranado,Citli Clerk a T, Hudak.•Cit' Manager 9/16/2022 I 11:40 EDT Date: FOR CONSULTANT: PUBLIC TRUST ADVISORS, LLC ATTEST: • By: 4 )1 tdAl___ 1U14 N c•. CI 11401/4( Print Na a and Title ' Print Name and Title Date: //> / APPROVED AS TO FORM& LANGUAGE & FOR EXECUTION ;91(tkatti . 10(01 City Attorney f/' Date r 16. DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647-40D1-47BE-8E76-B11BC7B046E4 Contract no.21-264-01 EXHIBIT A SCOPE OF SERVICES Consultant at a minimum,will provide the following Services: 1. The City expects Consultant to be highly experienced,a leader and innovator in the management of investments, and able to provide comprehensive investment advisory services. Consultant and its affiliates will be restricted from selling to the City, or buying from the City, any securities to or from that firm's own inventory or account. 2. Consultant will also be restricted from placing into the City's portfolio any securities for which it, or an affiliate, is the issuer.Consultant will not provide custodial services or security safekeeping. 3. All City investments, except for swap agreements must be held in an independent custodial account. 4. Provide full-time management on a daily basis of the City's investment portfolio pursuant to the specific stated investment objectives and the City's Investment Policy. 5. Place all orders for the purchase and sale of securities, communicate settlement information to City staff and assist in coordinating security settlement. 6. Serve as a general resource to City staff for information, advice and training regarding securities, investment and yield curve analysis. 7. Work with City staff to develop cash flow projections to ensure that the investment strategy is consistent with the City's cash requirements. 8. Provide online real-time access to the City's portfolio that includes, at a minimum, the following information: a. monthly statements detailing investment activity and earnings, b. the value of the investment portfolio, c. portfolio return and monthly mark to market valuation d. weighted average maturity e. accrued interest by investment type f. rating of investment by Standards&Poor's and Moody's. 9. Consultant must maintain accurate reports including portfolio composition showing diversity of investments and compliance with applicable investment policies of the City of Miami Beach and State of Florida Statutes. 10. Develop and implement investment strategies for the Advisory Account that will seek to enhance portfolio performance under current and future market conditions within the parameters of the City's investment policy and cash flow needs. 11. Obtain and document competitive prices for investment transactions. 12. Provide semi-annual and annual portfolio performance reports. 13. Review and update the City's investment policy and written investment procedures. 14. Coordinate and pay any fees associated with rating agencies for the annual rating review and certification of the City's investment policy. 15. Perform due diligence reviews of current and proposed broker/dealers. 16. Monitor the creditworthiness of the City's depository and custodian bank and investments in the portfolio. 17. Provide training on investment management subjects and guarantee minimum 8hrs of CPE in person or virtual training, at the sole discretion of the City, in accordance with Florida Statue 218.415. 17 DocuSign Envelope ID:68A084C7-63AF-4907-924A-SE3C31B1A2C0 DocuSign Envelope ID:5ECAF647-40D1-47BE-8E76-B11BC7B046E4 • Contract no.21-264-01 18. Provide, real-time access to the City's portfolio via an Online Web Based Reporting System accessible by the City. 19. Attend meetings with the City's finance staff and governing body upon request;and 20. Facilitate and fund arbitrage calculations and reports on the investment of bond proceeds. [REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK] • 18 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647-40D1-47BE-8E76-B11BC7B046E4 Contract no.21-264-01 EXHIBIT B FEE SCHEDULE The Consultant Fee is set as a Not to Exceed amount of$365K per year,according to a"4 tier asset values" See fee structure below: Average Daily Portfolio Market Value$936,941,605 Tier Fee Structure Tier 1 $100,000,000.00 0.0500% $4,166.67 Tier 2 $200,000,000.00 0.0400% $3,333.33 Tier 3 $550,000,000.00 0.0265% $12,145.83 Tier 4 $186,941,605.52 0.0200% $3,115.69 Weighted Fee 0.0292% $22,761.53 Analysis based on March 2020 Invoice. Other Items: 1) Consultant will pay for all fees associated with the following: A. Investment Policy Rating: Consultant coordinates with S&P for the annual review for the AAA rating and follow up with City's Finance staff with any requested information required to complete the ratings review process. Consultant will pay for fees associated with this review. B. Certification: The City received the Association of Public Treasurer's (APT) investment policy certification in 2019 (based on the City's approved updated investment policy from December 2019). The APT recommends a policy certification renewal every three years. Consultant will coordinate the renewal and pay for renewal fees. C. Custodial Fees: Consultant will pay custodial fees charged for custodial services on the City's investment accounts held by a third party. D. Arbitrage Calculation and Report Fees: Consultant will pay the annual costs for the report prepared by a third party. See Exhibit C attached hereto for details and costs and,Exhibit D for agreement with the third-party Consultant Hilltop Securities. 2) Consultant will provide 8 hours of CPE in accordance with Florida State Statute 19 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647-4001-47BE-8E76-B11BC7B046E4 Contract no.21-264-01 218.415 at no additional cost to the City. Host an annual in person seminar in October in Orlando each year. In addition,coordinate with the City to provide up to 8 hours of in person training at the City's preferred location and/or via virtual training, for City employees that require this training prior to the September 30th fiscal year end and commit to this timeline. [BALANCE OF PAGE INETIONALLY LEFT BLANK] 20 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647-40D1-47BE-8E76-B11BC7B046E4 Contract no.21-264-01 Last updated 3/22/2022 EXHIBIT C HilltopSecurnties imam^•-•w ee City Miami tenth,Florida Annual Fee Estimate September ID,2022 through September 30,2026 1'l..,0 c,mddanv.l:r.ter dm cAternir,o4 twee"da Mn 2..rra dl,monthnru0ulvzW.daul 0/70/22 7/30/2) 3/)0/14 0/10126 7/70/16 Neu 1•fur that flu Prorateda Ref Proratrd at Ins Proelud It reef Prorated N toes t.nralel at D.Vrery Usu. lnrtanmanl M,tarnr SU000ontr.n 5IA0000n4ue 51.000600mo 51.0000OMefu SL:00 Contra Oue 0., 4rue0ua:AWn On. On. On,fee(II DM hl ill Oa..Fr.II) 0116 full) Eau InIll I1/00A1 10.640000 O viva.OWaa(a.Reap tonn.Sn201a 4Uf. 01/01r21 2,16000 1,20000 It) Ill (11 117/05/15 17330030 Seermranr doe nue Odra..3..411015 Ot/05/f1 09;01/.5 110000 110000 1,e0000 1,13001 1.00Om 17/65/t5 104.920,037 linen roe(enenca 4one,Suu.2015 12/15/75 09/01/43 610000 1.46000 1.40000 1,63000 01000 12/15/IS 36,676.000 Pope.R,v.neo 0o.d,.7er,,,1015 12/15/16 07101/15 110000 1,f0000 1.40360 131060 1.11000 I l/i5/IS 966,2.5,000 r.a wr t,v L Pre.drat Cndl,fr,2015A 17/15/25 03101/ae L,'0000 1.20000 1,e00 00 133003 1310 CO IOW pole,/M..o.6 Conn,n Write) 17/I6/17 116,160,000 L:ufi us.P.s and en.?Ade 6Wd1,1uf017 12/•a/R 07/01/2/ 1,65000 1.11000 1,e0000 1.44000 l.00000 12/32/17 156350.070 llonor.ner 0n.ery I,..serfs.0ond,.5r.Z012 12/12/72 03/007 1.77000 106000 1.10000 1,e0000 I,r•0000 0110711) 167,116000 640efa100704/1e4 10061/1.00e.4.1r12015 05/02/20 01/01/47 1,4(0.00 1.000.00 1,400.10 1,400.00 1,40000 07/01/20 19.1/7,070 LP...taren 010fe tan torn eseed3vaune,Z313 07/02/26 09/01/07 1,610 0 1.03200 130000 1,10000 1,67000 10/1e/71 32160,000 WII e. rt.0.000400n4.104 13211, 10/10/16 12/01/17 135200 100000 1.e0000 1400.00 1,6007 512.12000 017.26000 512,600.00 511.010,00 51741000 h)pleats out Ilm tots i..n'Anna.76e au14e nforfed to Hung.400 to,5.alnery of nrw d,uµ 1M2 sews',,,,,d 6na1.0M,141 due to.f(wr0.,p.t4w.INa w.11 Or eoyen loth.fame lee as lb..el1tNf Nloa(51400 prpe1lad renurl4f. RI 2tl5addaNeened.foal e00.4a6on 0edam,d erg 9/1/21. [REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK] • 21 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647-40D1-47BE-8E76-B11BC7B046E4 Contract no.21-264-01 EXHBIT D ARBITRAGE AGREEMENT: HILLTOP SECURITIES 22 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647-40D1-47BE-8E76-811BC7B046E4 Third party Arbitrage Services Agreement pursuant to RFQ-2021-264-KB-Investment Advisory Services with Public Trust Advisors Form No. 148(f);Revised 02/01/2022 AGREEMENT FOR ARBITRAGE REBATE COMPLIANCE SERVICES BETWEEN CITY OF MIAMI BEACH, FLORIDA (Hereinafter Referred to as the"ISSUER") AND HILLTOP SECURITIES ASSET MANAGEMENT,LLC (Hereinafter Referred to as"HSAM") It is understood and agreed that the Issuer, in connection with the sale and delivery of certain bonds, notes,certificates, or other tax-exempt obligations(the`Obligations"),will have the need to determine to what extent,if any,it will be required to rebate certain investment earnings(the amount of such rebate being referred to herein as the"Arbitrage Amount") from the proceeds of the Obligations to the United States of America pursuant to the provisions of Section 148(f)(2)of the Internal Revenue Code of 1986,as amended(the"Code"). For purposes of this Agreement, the term"Arbitrage Amount" includes payments made under the election to pay penalty in lieu of rebate for a qualified construction issue under Section 148(0(4)of the Code. If it is accepted by the Issuer, this shall become the agreement(the"Agreement') between the Issuer and HSAM and will become effective at the date of its acceptance as provided for herein below. I. This Agreement shall apply to all issues of tax-exempt Obligations delivered subsequent to the effective date of the rebate requirements under the Code,except for(i)issues which qualify for exceptions to the rebate requirements in accordance with Section 148 of the Code and related Treasury regulations,or(ii) issues excluded by the Issuer in writing in accordance with the further provisions hereof, (iii) new issues effected in a fashion whereby HSAM is unaware of the existence of such issue, (iv) issues in which, for reasons outside the control of HSAM,HSAM is unable to procure the necessary information required to perform such services. Covenants of Hilltop Securities Asset Management 2. HSAM agrees to provide our professional services in determining the Arbitrage Amount with regard to the Obligations. The Issuer will assume and pay the fee of FISAM as such fee is set out in Appendix A attached hereto. HSAM shall not be responsible for any expenses incurred on behalf of Issuer in connection with providing such professional services, including any costs incident to litigation, mandamus action, test case or other similar legal actions. 3. HSAM agrees to perform the following duties in connection with providing arbitrage rebate compliance services: a. To cooperate fully with the Issuer in reviewing the schedule of investments made by the Issuer with (i) proceeds from the Obligations, and (ii) proceeds of other funds of the Issuer which, under Treasury Regulations Section 1.148,or any successor regulations thereto,are subject to the rebate requirements of the Code; b. To perform, or cause to be performed, consistent with the Code and the regulations promulgated thereunder,calculations to determine the Arbitrage Amount under Section 148(f)(2)of the Code:and c. To provide a report to the Issuer specifying the Arbitrage Amount based upon the investment schedule,the calculations of bond yield and investment yield, and other information deemed relevant by HSAM. In undertaking to provide the services set forth in paragraph 2 and this paragraph 3, HSAM does not assume any responsibility for any record retention requirements which the Issuer may have under the Code or other applicable laws, it being understood that the Issuer shall remain responsible for compliance with any such record retention requirements. HSAM shall maintain Issuer records and work product pursuant to.tils own, internal document retention policy. 1 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647-40D1-47BE-8E76-B11BC7B046E4 Covenants of the Issuer 4. In connection with the performance of the aforesaid duties,the Issuer agrees to the following: a. The fees due to HSAM in providing arbitrage rebate compliance services shall be calculated in accordance with Appendix A attached hereto. The fees will be payable upon delivery of the report prepared by HSAM for each issue of Obligations during the tenn of this Agreement. b. The Issuer will provide IISAM all information regarding the issuance of the Obligations and the investment of the proceeds therefrom, and any other information necessary in connection with calculating the Arbitrage Amount. HSAM will rely on the information supplied by the Issuer without inquiry, it being understood that IISAM will not conduct an audit or take any other steps to verify the accuracy or authenticity of the information provided by the Issuer. c. The Issuer will notify HSAM in writing of the retirement, prior to the scheduled maturity, of any Obligations included under the scope of this Agreement within 30 days of such retirement. This notification is required to provide sufficient time to comply with Treasury Regulations Section 1.148-3(g) which requires final payment of any Arbitrage Amount within 60 days of the final retirement of the Obligations. In the event the Issuer fails to notify HSAM in a timely manner as provided hcreinabove, HSAM shall have no further obligation or responsibility to provide any services under this Agreement with respect to such retired Obligations. 5. In providing the services set forth in this Agreement, it is agreed that HSAM shall not incur any liability for any error of judgment made in good faith by a responsible officer or officers thereof and,except to the limited extent set forth in this paragraph, shall not incur any liability for any other errors or omissions, unless it shall be proved that such error or omission was a result of the gross negligence or willful misconduct of said officer or officers. In the event a payment is assessed by the Internal Revenue Service due to an error by HSAM, the Issuer will be responsible for paying the correct Arbitrage Amount and HSAM's liability shall not exceed the amount of any penalty or interest imposed on the Arbitrage Amount as a result of such error. Additionally, it is understood and agreed that HSAM shall incur no liability for any errors, omissions, or failure to make a timely payment in connection with any IRS Computation Date calculations occurring prior to the effective date of the Initial Agreement with the Issuer,even if the error is discovered after the date of HSAM's engagement. No Coordination with Private Activity Regulations 6. The purpose of HSAM's engagement is to determine the Arbitrage Amount pursuant to Section 148(f)(2) of the Code. Sections 141-147 of the Code and the related Treasury Regulations set forth requirements with respect to the amount of obligation proceeds that may be used for the benefit of a private person or entity. Treasury Regulations Section 1.141-6(a) requires that allocations of expenditures of obligation proceeds for purposes of computing the Arbitrage Amount must be the same as the allocations of expenditures used to test the private use of projects financed with proceeds of the Obligations. 7. For purposes of calculating the Arbitrage Amount,our calculations assume that the allocation of the expenditures of Obligation proceeds as provided to us are the same for both purposes of Sections 141-147 and Section 148 of the Code. The scope of this engagement does not include procedures to analyze the private use limitations associated with the Obligations. Obligations'Issued Subsequent to Initial Agreement 8. The services contracted for under this Agreement will automatically extend to any additional Obligations(including financing lease obligations) issued during the term of this Agreement if such Obligations are subject to the rebate requirements under Section 148(0(2) of the Code. In connection with the issuance of additional Obligations, the Issuer agrees to the following: a. The Issuer will notify or cause the notification, in writing, to HSAM of any tax-exempt financing (including financing lease obligations)issued by the Issuer during any calendar year of this Agreement,and will provide IISAMMM with such information regarding such Obligations as HSAM may request in connection with its performance of the arbitrage rebate services contracted for hereunder.If such notice is not provided 2 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647-40D1-47BE-8E76-B11BCTB046E4 to HSAM with regard to a particular Obligation, HSAM shall have no obligation to provide any services hereunder with respect to such Obligation. jb. At the option of the Issuer, any additional Obligations to be issued subsequent to the execution of this Agreement may be excluded from the services provided for herein. In order to exclude an issue,the Issuer must notify HSAM in writing of their intent to exclude any specific Obligations from the scope of this Agreement,which exclusion shall be permanent for the full life of the Obligations;and after receipt of such notice,HSAM shall have no obligation to provide any services under this Agreement with respect to such excluded Obligations. Effective Date of Agreement 9. This Agreement shall become effective at the date of acceptance by the Issuer as set out herein below and remain in effect thereafter for a period of five(5)years from the date of acceptance,provided, however, that this Agreement may be terminated with or without cause by the Issuer or HSAM upon thirty(30)days prior written notice to the other party. In the event of such termination,it is understood and agreed that only the amounts due to FISAM for services provided and expenses incurred to and including the date of termination will be due and payable. No penalty will be assessed for termination of this Agreement. In the event this Agreement expires or is terminated prior to the completion of its stated term,all records provided to HSAM with respect to the investment of monies by the Issuer shall be returned to the Issuer as soon as practicable following written request by issuer, provided that such records have not been destroyed pursuant to HSAM's internal document retention policy. In addition, the parties hereto agree that, upon termination of this Agreement, FISAM shall have no continuing obligation to the Issuer regarding any arbitrage rebate related services contemplated herein,regardless of whether such services have previously been undertaken,completed,or performed. • Acceptance of Agreement 10. When accepted by the Issuer in accordance with the terms hereof,it,together with Appendix A attached hereto,will constitute the entire Agreement between the Issuer and HSAM for the purposes and the consideration herein specified. In order for this Agreement to become effective, it must be accepted by the Issuer within sixty(60)days of the receipt by the Issuer. After the expiration of such 60-day period,acceptance by the Issuer shall only become effective upon delivery of written acknowledgement and reaffirmation by HSAM that the terms and conditions set forth in this Agreement remain acceptable to HSAM. Counterpart Signatures 11. This Agreement may be executed in two or more counterparts,each of which shall be deemed an original and all of which together shall constitute one and the same instrument.Each Party may execute this Agreement on a facsimile or PDF hereof.In addition,facsimile or PDF signatures of either Party shall,be valid and binding,and delivery of a facsimile or PDF signature by either Party shall constitute due,execution and delivery of this Agreement. Governing Law 12. This Agreement will be governed by and construed in accordance with the laws of the State of Texas,without regard to its principles of conflicts of taws. Acceptance 13. Acceptance will be indicated by returning one executed copy to HSAM. An electronic version is acceptable. HSAIvi will then execute the Agreement and return a fully executed electronic version of the Agreement to the Issuer. 3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DociSign Envelope.ID:5ECAF647-40D1-47BE-8E76-B11 BC7B046E4 Respectfully submitted, HILLTOP SECURITIES ASSET MANAGEMENT.,LLC r—Docuslonad by: Mt,,6t6 R4, BYLvjwik. 493487351164A7... David K.Medanich,President 7/11/2022 Date. ISSUER'S ACCEPTANCE CLAUSE The above and foregoing,is hereby in all things accepted and approved by City of Miami Beach ` (Issuer Name),;on this the /6- day of S-ep er , 202.Z By orized•Representative Title City Manager Printed Name Ali na T. Hudak APPROVED AS TO FORM& LANGUAGE & FOR EXECUTION City Attorney .>'' Da I { 4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31BIA2C0 DocuSign Envelope ID:5ECAF647-40D1-47BE-8E76-B11BC7B046E4 APPENDIX A-FEES The Obligations to be covered initially under this Agreement include all issues of tax-exempt obligations delivered subsequent to the effective dates of the rebate requirements,under the Code,except as set forth in Section 1 of the Agreement. The fee for any Obligations under this Agreement shall only be payable if a computation is required under Section 148(0(2)of the Code. in the event that any of the Obligations fall within an exclusion to the computation requirement as defined by Section 148 of the Code or related regulations and no calculations were required by HSAM to make that determination,no fee will be charged for such issue. For example,certain obligations are excluded from the rebate computation requirement if the proceeds ate spent within specific time periods. In the event a particular issue of Obligations fulfills the exclusion requirements of the Code or related regulations, the specified fee will be waived by HSAM if no calculations were required to make the determination. HSAM's fee for arbitrage rebate services is based upon a fixed Calculation Period fee per issue.The Calculation Period fee is charged based upon the number of Calculation Periods that proceeds exist subject to rebate from the delivery date of the issue to the Calculation Date. EISAM's fees are payable upon delivery of the report. The first report will be made following one Calculation Period from the date of delivery of the Obligations and on each Calculation Date thereafter during the term of the Agreement. The fees for computations of the Arbitrage Amount which encompass more,or less,than one Calculation Period shall be prorated to reflect the longer,or shorter,period of work performed during that period. The fee for each of the Obligations included in this Agreement shall be based on the table below. Additionally,due to significant time saving efficiencies realized when investment information is submitted in an electronic format, HSAM passes the savings to its clients by offering a 10% reduction in its fees if information is provided in a spreadsheet or electronic text file format. Description FEE ANNUAL CALCULATION PERIOD $1,400 COMPREHENSIVE ARBITRAGE COMPLIANCE SERVICES INCLUDE: • Commingled Funds Analysis&Calculations • Spending Exception Analysis&Calculations • Yield Restriction Analysis&Calculations (for yield restricted Project Funds,Reserve Funds,Escrow Funds,etc.) • Parity Reserve Fund Allocations • Transferred Proceeds Calculations • Universal Cap Calculations • Debt Service Fund Calculations(including earnings test when required) INCLUDED • Preparation of all Required IRS Paperwork for Making a Rebate Payment/Yield Reduction Payment • Retention of Records Provided for Arbitrage Computations • iRS Audit Assistance • Delivery of Rebate Calculations Each Year That Meets the Timing Requirements of the Audit Schedule • On-Site Meetings,as Appropriate,to Discuss Calculation Results/Subsequent Planning Items OTHER SERVICES AVAILABLE: IRS Refund Request—Update calculation,prepare refund request package,and assist issuer as necessary $750 in responding to subsequent IRS information Requests 5 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:5ECAF647-40D1-47BE-8E76-B11BC7B046E4 EXPLANATION OF TERMS: a. Bond Year:A"Bond Year"is each 1-year period selected by the issuer. The first and last bond years may be short periods. If no bond year is selected,bonds years will end on each anniversary date of the issue and at final maturity. b. Computation Date:A"Computation Date"is a five bond year period no longer than five years after the issue date. Subsequent Computation Dates will be for a period not later then 5 years after the previous Computation Date and at final maturity of the issue. c. Calculation Period:A"Calculation Period"represents a one year period from the delivery date of the issue to the date that is one calendar year after the delivery date, and each subsequent one-year periods thereafter. Therefore, if a calculation is required that covers more than one Calculation Period,the Calculation Period fee is multiplied by the number of periods contained in the calculation being performed. If a calculation includes a portion of a Calculation Period,i.e.,if the calculation includes I %Calculation Periods,then the base fee will be multiplied by 1.5. d. Electronic Data Submission: The data should be provided electronically in MS Excel or ASCII text file(comma delimited text preferred) with the date, description, dollar amount,and an activity code(if not in debit and credit format)on the same line in the file. e. Variable/Floating Rate Bond Issues: Special services are also required to perform the arbitrage rebate calculations for variable rate bonds, A bond is a variable rate bond if the interest rate paid on the bond is dependent upon an index which is subject to changes subsequent to the issuance of the bonds. The computational requirements of a variable rate issue are more complex than those of a fixed rate issue and, accordingly,require significantly more time to calculate.The additional complexity is primarily related to the computation of the bond yield,which must be calculated on a"bond year" basis. Additionally, the regulations provide certain flexibility in computing the bond yield and determining the arbitrage amount over the first IRS reporting period;consequently,increased calculations are required to determine which bond yield calculation produces the lowest arbitrage amount. f. Commingled Fund Allocations: By definition, a commingled fund is one that contains either proceeds of more than one bond issue or proceeds of a bond issue and non-bond proceeds (i.e.,revenues) of$25,000 or more. The arbitrage regulations,while permitting the commingling of funds,require that the proceeds of the bond issue(s)be "carved out" for purposes of determining the arbitrage amount. Additionally, interest earnings must be allocated to the portion of the commingled fund that represents proceeds of the issue(s) in question. Permitted "safe-harbor" methods(that is,methods that are outlined in the arbitrage regulations and,accordingly,cannot be questioned by the IRS under audit),exist for allocating expenditures and interest earnings to issues in a commingled fund.HSAM uses one of the applicable safe-harbor methods when doing these calculations. g. Debt Service Reserve Funds: The authorizing documents for many revenue bond issues require that a separate fund be established (the"Reserve Fund") into which either bond proceeds or revenues are deposited in an amount equal to some designated level, such as average annual debt service on all parity bonds. This Reserve Fund is established for the benefit of the bondholders as additional security for payment on the debt. In most cases, the balance in the Reserve Fund remains stable throughout the life of the bond issue. Reserve Funds,whether funded with bond proceeds or revenues,must be included in all rebate calculations. h. Debt Service Fund Calculations: Issuers are required under the regulations to analyze the invested balances in their debt service funds annually to determine whether the fund depletes as required during the year and is, therefore,"bona fide"(i.e.,potentially exempt from rebate in that year).It is not uncommon for surplus balances to develop in the debt service fund that services an issuer's tax supported debt,particularly due to timing differences of when the funds were due to be collected versus when the funds were actually collected. IISAM performs this formal analysis of the debt service fund and,should it be determined that a surplus balance exists in the fund during a given year, allocates the surplus balance among the various issues serviced by the fund in a manner that is acceptable under IRS review. i. Earnings Test for Debt Service Funds: Certain types of bond issues require an additional level of analysis for the debt service fund, even if the fund depletes as required under the regulations and is"bona fide." For short-term, fixed rate issues, private activity issues,and variable rate issues, the regulations require that an "earnings test" be performed on a bona fide debt service fund to determine if the interest earnings reached$100,000 during the year.In 6 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31BIA2C0 DocuSlgn Envelope ID:5ECAF647-40D1.47BE-8E76-BI1BC7B046E4 cases where the earnings reach or exceed the$100,000 threshold, the entire fund (not just the surplus or residual portion)is subject to rebate. j. Transferred Proceeds Calculations:When a bond issue is refinanced(refunded)by another issue,special services relating to"transferred proceeds"calculations may need to be performed.Under the regulations,when proceeds of a refunding issue are used to retire principal of a prior issue,a pro-rata portion of the unspent proceeds of the prior issue becomes subject to rebate and/or yield restriction as transferred proceeds of the refunding issue.The refunding issue essentially"adopts" the unspent proceeds of the prior issue for purposes of the arbitrage calculations.These calculations are required under the regulations to ensure that issuers continue to exercise due diligence to complete the project(s)for which the prior bonds were issued. k. Universal Cap: Current regulations provide an overall limitation on the amount of gross proceeds allocable to an issue. Simply stated,the value of investments allocated to an issue cannot exceed the value of all outstanding bonds of the issue. For example, this situation can occur if an issuer encounters significant construction delays or enters into litigation with a contractor. It may take months or even years to resolve the problems and begin or resume spending the bond proceeds;however,during this time the debt service payments are still being paid,including any scheduled principal payments.Thus,it's possible for the value of the investments purchased with bond proceeds to exceed the value of the bonds outstanding. In such cases,a"de-allocation"of proceeds may be required to comply with the limitation rules outlined in the regulations. 1. Yield Restriction Analysis/Yield Reduction Computations: The IRS strongly encourages issuers to spend the proceeds of each bond issue as quickly as possible to achieve the governmental purpose for which the bonds were issued. Certain types of proceeds can qualify for a "temporary period," during which time the proceeds may be invested at a yield higher than the yield on the bonds without jeopardizing the tax-exempt status of the issue.The most common temporary period is the three-year temporary period for capital project proceeds. After the end of the temporary period, the proceeds must be yield restricted or the issuer must remit the appropriate yield reduction payment when due. HSAM performs a comprehensive yield restriction analysis when appropriate for all issues having proceeds remaining at the end of the applicable temporary period and also calculates the amount of the yield reduction payment due to the IRS. 7 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 DocuSign Envelope ID:SECAF647-40D1-47BE-8E76-B11BC7B046E4 • Contract no.21-264-01 EXHIBIT E CITY OF MIAMI BEACH INVESTMENT POLICY • 23 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 • CITY OF MIAMI BEACH INVESTMENT POLICY AND PROCEDURE • • iNCORP ORATEQ r.. �f`• i Approved and Amended as of December 12, 2018 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Table of Contents I. Background 3 II. General Overview 3 III. Cash Management 3 IV. Scope 3 V. Bond Funds • 4 VI. Objectives 4 Safety of Capital • Liquidity Return on Investment VII. Prudence and Ethical Standards 5 VIII. Authority and Responsibility 6 IX. Maturity and Liquidity Requirements 6 X. Suitable and Authorized Investments 7 Portfolio Composition and Diversification • XI. Derivatives 18 XII. Prohibited Investments 18 XIII. Authorized Investment Institutions and Dealers 19 • Qualified Financial Institutions and Securities Dealers • Selection Criteria XIV. Third-Party Custodial Agreements 20 Delivery vs. Payment XV. Treasury Management Service Master Agreement 21 XVI. Bid Requirements .21 XVII. Internal Controls 22 XVIII. Continuing Education 23 XIX. Reporting 23 Marking-to-Market XX. Securities 23 XXI. Sale of.Securities 24 XXII. Performance Measurements.. 24 XXIII. Investment Committee ..25 XXIV. Exemptions 25 XXV. Amendments 25 XXVI. History of Amendments 25 Appendices: A. Section 218.415, Florida Statutes • B. GFOA Recommended Practices C. Investment Firm Certification Form D. Master Repurchase Agreement E. investment Pool/Fund Questionnaire F. Glossary of Cash and Investment Management Terms 2 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • I. BACKGROUND The Florida Legislature passed CS/SB 2090 (CS/HB 1795) on May 4, 1995. Among other provisions of this legislation each local government entities required to create, adopt and maintain comprehensive investment policies, incorporating fourteen required elements. The City has operated under investment guidelines adopted in 1985 and subsequent Ordinance No. 87-2588 and 92-2793 which authorized additional investment alternatives for the City. Due to the adoption of Chapter 218.415 of the Florida Statue, which governs investment policies for local governments, the Mayor and City Commission adopted Resolution No. 95-21726 on September 27, 1995. Thee City Code Section 18A-1 (reflecting the City's prior adopted investment policies) was repealed. The City's Investment Policy and Procedure has been amended accordingly. II. GENERAL OVERVIEW The City of Miami Beach has established policies relating to the investment of excess funds. Excess funds are defined as funds not required to meet short term expenditures of the City. Excess funds are placed in two general categories of investments. The first category is "cash management investments." Cash management investments are defined as investments whose terms are less than one year. Those funds placed in cash management investments include all daily operating funds, debt service funds and various deposits. The second category is "long term city investments." Long term city investments are investments whose terms are more than one year. III. CASH MANAGEMENT Short term expenditures are defined as all daily operating expenditures excluding payroll and debt service which are invested based on their payment cycle. For short term expenditures, the City maintains a continuous investment program, a Municipal NOW account, collateralized by full faith and credit instruments of the U.S. Government and its Agencies, held by the State of Florida, with the City designated as collateral beneficiary. The City complies with the State of Florida "Public Deposits Law" Chapter 280 Florida Statutes. Chapter 280 insures the City against investment principal loss on certificates of deposits and demand deposits in excess of $250,000 per institution. FDIC insurance covers demand deposits up to $250,000 per institution. The City will utilize only financial institutions qualified under Chapter 280, a listing of which is.received by the City and reviewed on a quarterly basis. The City also complies with Chapter 280 by filing all required reports annually with the State. IV. SCOPE This Investment Policy ("Policy") applies to all transactions involving the financial assets held or controlled by the City of Miami Beach ("City") and its blended component units, not otherwise classified as restricted assets requiring separate investing,in accordance with the requirements of Section 218.415,Florida Statutes. • This Policy shall not apply to discrete component units and pension funds,including those funds under chapters 175 and 185, or funds related to the issuance of debt where there are other 3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 existing policies or indentures in effect for such funds or assets held by third parties(custodians or money managers)under Bond Trust Indenture Agreements.Each pension system has elected or appointed members to its pension Board of Trustees who exercise oversight over money managers engaged to manage pension fund investments in accordance with policies and guidelines established by each pension system. The Boards,therefore,have oversight authority over investments for pension systems and the City does not actively participate in this process. Cash and investment balances as defined in this Section are entirely known as "Available Funds." V. BOND FUNDS Notwithstanding anything to the contrary contained in the bond documents or these investment guidelines the provisions pertaining to investment of monies under all ordinances, resolutions,trust indentures and agreements adopted or entered into by the City in connection with bonds issued by the City or other dept incurred by the City will control and supersede the provisions herein contained with respect to the investment of such monies. VI. OBJECTIVES . The primary objectives, in priority order, of investment activities shall be safety of capital, liquidity of funds and then return on investment. Safety of Capital Safety of capital is the primary objective of the investment program. Accordingly,the overall investment portfolio shall be managed to ensure capital (principal) losses are avoided by mitigating credit risk and interest rate risk. • Credit Risk Credit risk is the risk of loss due to the failure of the security issuer or supporter.Credit • risk is mitigated by: • Limiting investments to the safest types of securities. • Pre-qualifying financial institutions,broker/dealers,intermediaries,and advisors with which the'City will do business. • Diversifying the investment portfolio to minimize potential losses on individual securities. • Monitoring investments to anticipate and respond appropriately to changing market conditions. Interest Rate Risk Interest rate risk is the risk that the market value of securities in the portfolio will fall due to changes in general interest rates. Interest rate risk may be mitigated by: • Structuring portfolio maturities to match cashflow requirements for ongoing operations,thereby avoiding the need to sell securities on the open market prior to maturity. • 4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • Investing operating funds primarily in shorter-term securities. • • Liquidity The investment portfolio shall remain sufficiently liquid to meet all operating, payroll, and capital requirements that may be reasonably anticipated. The portfolio should always encompass the ability for quick conversion to cash without loss of principal to meet cashflow requirements. Return on Investment The investment portfolio shall be designed with the objective of attaining a market rate of return throughout budgetary and economic cycles,considering the investment risk constraints and liquidity needs. Return on investment is of least importance compared to the safety and liquidity objectives described above. However, return is attempted through active management where the adviser utilizes a total return strategy (which includes both realized and unrealized gains and losses in the portfolio).This total return strategy seeks to increase the value of the portfolio through reinvestment of income and capital gains. The core of investments is limited to relatively low risk securities in anticipation of earning a fair return relative to the risk being assumed. Despite this, a portfolio manager may trade to recognize a loss from time to time to achieve a perceived relative value based on its potential to enhance the total return of the portfolio. VII. PRUDENCE AND ETHICAL STANDARDS Investments shall be made with judgment and care,under circumstances then prevailing,which persons of prudence, discretion, and intelligence exercise in the management of their own affairs,not for speculation,but for investment,considering the safety of capital,liquidity needs, and the expected income to be derived from the investment. Officers and employees involved in the investment process shall refrain from personal business activity that could conflict with the State Statutes and other laws, proper execution and management of the investment program, or that could impair their ability to make impartial decisions. Employees and investment officials shall disclose any material interests in financial institutions with which they conduct business. They shall further disclose any personal financial/investment positions that could be related to the performance of the investment portfolio. Employees and officers shall refrain from undertaking personal investment transactions with the same individual with whom business is conducted on behalf of the City. While the standard of prudence to be used by the City's staff is the Prudent Person standard, any person or firm hired or retained to invest, monitor, or advise concerning these assets shall be held to the higher standard of"Prudent Expert." The standard shall be that in investing and reinvesting moneys and in acquiring, retaining, managing, and disposing of investments of these funds, the contractor shall exercise: the judgment, care, skill, prudence, and diligence under the circumstances then prevailing, which persons of prudence, discretion, and intelligence, acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of like character and with like aims by diversifying the investments of the funds, so as to minimize the risk, considering the probable income as well as the probable safety of 5 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 • their capital. VIII. AUTHORITY AND RESPONSIBILITY The Chief Financial Officer (CFO) is designated as the investment officer of the City and is responsible for the oversight of the management of the investment portfolio and to establish and maintain internal controls over the investment process consistent with this Policy, under the direction of the City Manager. • The CFO has designated the Deputy Finance Director and Treasury Manager as the individual responsible for managing the City's investments. The Investment Advisor discusses investments with upcoming maturities with the.CFO or designee if there is a question as to new maturity target dates or type of investment vehicle to be used. Based on these discussions,the Investment Advisor executes the transaction and completes an "Investment Transaction Report" for each investment transaction. Funds related to each investment are transferred according to authorized funds transfer procedures and limits established under the provisions of the City's contract with its main depository bank. In accordance with Resolution No. 2012-27816, the City is required to have an investment advisor with regards to the management of its investment program. Investment advisors shall be registered with the Securities Exchange Commission under the Investment Advisors Act of 1940. Advisors shall be selected using the City's authorized purchasing procedures for selection of professional services and shall be.subject to the provisions of this Investment Policy. Under no circumstance shall the advisor take custody of any City funds or securities. The City maintains employee dishonesty insurance and bonding for all employees and officials with signatory authority. • IX. MATURITY AND LIQUIDITY REQUIREMENTS Each year a cash flow analysis will be completed to determine the acceptable allocation and balances for each of the following funds.The Deputy Finance Director or Treasury Manager will be responsible for the cash flow analysis, which will be presented to the CFO for review. Operating Funds To the extent possible, an attempt will be made to match investment maturities with known cash needs and anticipated cash flow requirements. Individual investments of current operating funds shall have maturities of no longer than twenty-four(24) months ("Short-Term Portfolio"). Core Funds Investments of reserves, capital funds, and other non-operating funds ("Long- Term Portfolio")shall have a term appropriate to the need for funds, but in no event shall the maturity of any individual security exceed seven (7) years and the average duration of the portfolio may not exceed three (3)years. 6 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • X. SUITABLE AND AUTHORIZED INVESTMENTS • Investments should be made subject to.the cash flow needs and such cash flows are subject to revisions as market conditions and the City's needs change. However,when the invested funds are needed in whole or in part for the purpose originally intended or for more optimal investments,the CFO or designee may sell the investment at the then-prevailing market price • and place the proceeds into the proper account at the City's custodian. • The table on the following page summarize the investment instrument parameters and allocation limits on security types, issuers, and maturities, as established by the City. For complying with allocation limits,the term"Available Funds"is defined as Section I of this Policy and not including balances invested in the overnight sweep investment. The CFO or designee shall have the option to further restrict investment percentages from time to time based on market conditions, risk and diversification investment strategies. The percentage allocation requirements for investment types and issuers are calculated based on the market value of each investment at the time of purchase. Investments not listed in this Policy are prohibited. [ Remainder of the page left blank intentionally] • • • • DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Summary of Composition and Diversification Security Type Minimum Maturity Maximum Maximum Rating Limits Allocation Issuer Limit Requirement Limit A Florida PRIME Fund AAAm N/A 25% N/A B United States Government Securities N/A 7 Years 100% N/A C United States Government Agencies(full N/A 7 Years 50% 25% faith and credit of the United States D Federal Instrumentalities(United States N/A 7 Years 80% 40% Government Sponsored Enterprises ("GSE") which are non-full faith and credit).* E Mortgage-Backed Securities (MBS) * N/A 5 Years 15% ' 15% F Interest Bearing Time Certificates of Deposit N/A 3 Years 25% 15% or G Repurchase Agreements N/A • 90 Days 25% 25% H Commercial Paper P-1/A-1 270 Days 25% 5% I Corporate Notes AA rating 5 Years 40% 5% category by any two NRSROs*** J Asset-Backed Securities(ABS)** AA rating 5 Years 15% 5% category by any two NRSROs*** K Bankers'Acceptances P-1/A-1 180 Days 20% 5% L State and/or Local Government Taxable A rating 5 Years 20% 10% and/or category by two Tax-Exempt Debt NRSROs*** M Money Market Mutual Funds AAAm N/A 100% 50% N State of Israel Bonds** A rating 3 years 5%** N/A category by S&P or another NRSROs*** O Intergovernmental Investment Pool AAAm N/A 100% 50% P Florida League of Cities, Inc. Mutual Funds N/A N/A 25% 10% * The combined total of available funds invested in Federal Instrumentalities and Mortgage Backed Securities cannot be more than 80%. ** 5% of operating funds. Bond proceeds not permitted. *** National Recognized Statistical Rating Organization (NRSRO). • 8 • DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PORTFOLIO COMPOSITION AND DIVERSIFICATION Diversity of investment types is highly desirable. To promote diversity, no security or individual cusip shall exceed 5%of the City funds.Such diversity is necessary in cases where securities are traded frequently and not held to maturity and where volatile securities are traded. A. The Florida PRIME Fund. 1. Investment Authorization Invest in the Florida PRIME Fund. 2. Portfolio Composition A maximum of 25%of Available Funds may be invested in the Florida PRIME Fund. • 3. Rating Requirements • The money market funds shall be rated "AAAm"by Standard & Poor's or the equivalent by another Nationally Recognized Statistical Ratings Organization (NRSRO). 4. Due Diligence Requirements A thorough review of any money market fund is required prior to investing, and on a continual basis. The questionnaire provided in Appendix E must be completed prior to investing. B. United States Government Securities 1. Purchase Authorization Invest in negotiable direct obligations, or obligations the principal and interest of which are unconditionally guaranteed by the United States • Government. Such securities will include,but not be limited to the following: Cash Management Bills Treasury Securities — State and Local Government Series("SLGS")Treasury Bills Treasury Notes Treasury Bonds Treasury Strips 2. Portfolio Composition A maximum of 100%of Available Funds may be invested in the United States Government Securities. 9 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 3. Maturity Limitations . The maximum length to maturity of any direct investment in the United States Government Securities is seven (7)years from the date of purchase. C. United States Government Agencies(full faith and credit of the United States Government) 1. Purchase Authorization Invest in bonds, mortgage instruments, debentures or notes which may be subject to call,issued or guaranteed as to principal and interest by the United States Government Agencies, provided such obligations are backed by the full faith and credit of the United States Government. Such securities will • include, but not be limited to the following: Government National Mortgage Association (GNMA) GNMA guaranteed mortgage-backed bonds • GNMA guaranteed pass-through obligations • United States Export—Import Bank Direct obligations or fully guaranteed certificates of beneficial ownership Farmer Home Administration Certificates of beneficial ownership Federal Financing Bank Discount notes, notes and bonds Federal Housing Administration Debentures General Services Administration United States Maritime Administration Guaranteed Title XI Financing New Communities Debentures United States Government guaranteed debentures United States Public Housing Notes and Bonds United States Government guaranteed public housing notes and bonds United States Department of Housing and Urban Development Project notes and local authority bonds 2. Portfolio Composition • A maximum of 50%of Available Funds may be invested in United States Government Agencies. • 3. Limits on Individual Issuers A maximum of 25% of available funds may be invested in individual United • States Government Agencies. • 10 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • • 4. Maturity Limitations The maximum length to maturity for an investment in any United States Government Agency security is seven (7)years from the date of purchase. D. Federal Instrumentalities (United States Government Sponsored Enterprises ("GSE")which are non-full faith and credit). 1. Purchase Authorization Invest in bonds, mortgage instruments debentures or notes which may be subject to call, issued or guaranteed as to principal and interest by Federal Instrumentalities (United States Government Sponsored Enterprises),which are non-full faith and credit agencies including the following: Federal Farm Credit Bank(FFCB) Federal Home Loan Banks (FHLB) • Federal National Mortgage Association (FNMA) Federal Home Loan Mortgage Corporation (Freddie-Mac) including Federal-Home Loan Mortgage Corporation • participation certificates 2. Portfolio Composition A maximum of 80% of Available Funds may be invested in. Federal Instrumentalities. Callable securities are limited to 20%of Available Funds. The combined total of available funds invested in Federal Instrumentalities and Mortgage Backed Securities cannot be more than 80%. 3. Limits on Individual Issuers A maximum of 40%of Available Funds may be invested in individual Federal Instrumentalities. 4. Maturity Limitations The maximum length to maturity for an investment in any- Federal Instrumentality security is seven (7)years from the date of purchase. E. Mortgage-Backed Securities (MBS) 1. Purchase Authorization • Invest in mortgage-backed securities (MBS) which are based on mortgages that are guaranteed by a government agency or GSE for payment of principal and a guarantee of timely payment. 11 • DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 2. Portfolio Composition A maximum of 15%of available funds may be invested in MBS. The combined_ total of available funds invested in Federal Instrumentalities and Mortgage Backed Securities cannot be more than 80%. 3. Limits of Individual Issuers A maximum of 15%of available funds may be invested with any one issuer. 4. Maturity Limitations A maximum length to maturity for an investment in any MBS is five (5)years from the date of purchase. The maturity of mortgage securities shall be considered the date corresponding to its average life. This date reflects the point at which an investor will have received back half of the original principal (face) amount. The average life may be different from the stated legal maturity included in. a security's description. F. Interest Bearing Time Certificates of Deposit or Saving Accounts 1. Purchase Authorization • Invest in non-negotiable interest-bearing time certificates of deposit or savings accounts in banks organized under the laws of this state and/or in national banks organized under the laws of the United States and doing business and situated in the State of Florida,provided that any such deposits are secured by the Florida Security for Public Deposits Act, Chapter 280, Florida Statutes 2. Portfolio Composition A maximum of 25% of Available Funds may be invested in non-negotiable interest-bearing time certificates of deposit or savings accounts. 3. Limits on Individual Issuers A maximum of 15%of Available Funds may be deposited with any one issuer. 4. Maturity Limitations The maximum maturity on any certificate of deposit shall be greater than three(3)years from the date of purchase. 12 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 G. Repurchase Agreements 1. Purchase Authorization a. Invest in repurchase agreements composed of only those investments based on the requirements set forth by the City's Master Repurchase Agreement. All firms are required to sign the Master Repurchase Agreement prior to the execution of a repurchase agreement transaction. b. A third-party custodian with whom the City has a current custodial agreement shall hold the collateral for all repurchase agreements with a term longer than one (1) business day. A clearly marked receipt that shows evidence of ownership must be supplied to the CFO and retained. c. Securities authorized for collateral are negotiable direct obligations of the United States Government, Government Agencies, and Federal Instrumentalities with maturities under five (5) years and must have a market value for the principal and accrued interest of 102 percent of the value and for the term of the repurchase agreement. Immaterial short- term deviations from 102 percent requirement are permissible only upon the approval of the CFO or Deputy Finance Director. d. Repurchase Agreements will be limited to transactions in which the • proceeds will be used to provide liquidity. Any investment which is not issued in "Book Entry Only"form is physically held by the City in a secure vaulted area and surrendered only when invested funds and earnings are received by the City at maturity. 2. Portfolio Composition A maximum of 25% of Available Funds may be invested in repurchase agreements excluding one(1)business day agreements and overnight sweep agreements. 3. Limits on Individual Issuers A maximum of 25% of Available Funds may be invested with any one institution excluding one (1) business day agreements and overnight sweep agreements. 4. Limits on Maturities The maximum length to maturity of any repurchase agreement is 90 days from the date of purchase. 5. Performance Calculation Overnight sweep investments for calculating investment performance and asset allocation requirements will be excluded from the calculations. • 13 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 H. Commercial Paper 1. Purchase Authorization Invest in commercial paper of any company operating in the United States that is rated, at the time of purchase, at a minimum "Prime-1" by Moody's or better and"A-1"by Standard &Poor's or better(prime commercial paper) or the equivalent by two NRSROs at the time of purchase. 2. Portfolio Composition A maximum of 25% of Available Funds may be directly invested in prime commercial paper. 3. Limits on Individual Issuers A maximum of 5%of Available Funds may be invested with any one issuer. 4. Maturity Limitations The maximum length to maturity for prime commercial paper shall be 270 days from the date of purchase. I. Corporate Notes 1. Purchase Authorization Invest in corporate notes issued by corporations operating within the United States or by depository institutions licensed by the United States that have a long-term debt rating with a minimum"AA"rating category,or better,by any two NRSROs at the time of purchase. 2. Portfolio Composition A maximum of 40%of Available Funds may be directly invested in corporate notes. • • 3. Limits on Individual Issuers A maximum of 5%of Available Funds may be invested with any one issuer. 4. Maturity Limitations The maximum length to maturity for corporate notes shall be five (5) years from the date of purchase. J. Asset-Backed Securities (ABS) 1. Purchase Authorization The City may invest in asset-backed securities(ABS)which are bonds or notes backed by financial assets with a minimum "AA" rating category, or better, by any two NRSROs at the time of purchase. 14 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 2. Portfolio Composition A maximum of 15%of available funds may be invested in ABS. 3. Limits of Individual Issuers A maximum of 5%of available funds may be invested with any one ABS. 4. Maturity Limitations A maximum length to maturity for an investment in any ABS is five (5)years from the date of purchase. The maturity of asset-backed securities shall be considered the date corresponding to its average life. This date reflects the point at which an investor will have received back half of the original principal (face) amount. • The average life may be different from the stated legal maturity included in a security's description. K. Bankers'Acceptances 1. Purchase Authorization Invest in Bankers' Acceptances issued by a domestic bank or a federally chartered domestic office of a foreign bank, which are eligible for purchase by the Federal Reserve System,at the time of purchase,the short-term paper is rated,at a minimum,"P-1"by Moody's Investors Services or better and"A- 1"Standard &Poor's or better,or the equivalent by another NRSROs. 2. Portfolio Composition A maximum of 20% of Available Funds may be directly invested in•Bankers' Acceptances. 3. Limits on Individual Issuers A maximum of 5%of Available Funds may be invested with any one issuer. 4. Maturity Limitations The maximum length to maturity for Bankers'Acceptances shall be 180 days from the date of purchase. L. State and/or Local Government Taxable and/or Tax-Exempt Debt 1. Purchase Authorization Invest in state and/or local government taxable and/or tax- exempt debt, general obligation and/or revenue bonds, rated,at the time of purchased, at a minimum single "A" category by any two NRSROs, or rated at a minimum "VMIG2" by Moody's or better and "A-2" by Standard & Poor's or better for short-term debt or the equivalent by another NRSRO. 15 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 2. Portfolio Composition A maximum of 20% Of Available Funds may be invested in taxable and tax- exempt debts. 3. Limits on Individual Issuers • A maximum of 10%of Available Funds may be invested with any one issuer. 4. Maturity Limitations A maximum length to maturity for an investment in any state or local government debt security is five (5)years from the date of purchase. M. Money Market Mutual Funds • 1. Purchase Authorization Invest in shares in open-end and no-load money market mutual funds provided such funds are registered under the Federal Investment Company Act of 1940 and operate in accordance with 17 C.F.R. § 270.2a-7, which stipulates that money market mutual funds must have an average weighted maturity of 60 days or less. The money market mutual funds shall be rated, at a minimum, "AAAm" by Standard & Poor's or the equivalent by another NRSRO. The prospectus of such funds must indicate that the share value shall not fluctuate. 2. Portfolio Composition A maximum of 100% of Available Funds may be invested in money market mutual funds. 3. Limits of Individual Issuers A maximum of 50%of Available Funds may be invested with any one money market mutual fund. 4. Due Diligence Requirements A thorough investigation of any money market mutual fund is required prior to investing and on a quarterly basis. The questionnaire provided in Appendix E must be completed prior to investing.A current prospectus must be obtained prior to investing. • 16 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 N. State of Israel Bonds 1. Investment Authorization Invest in Israel bonds, notes or instruments and backed by the full faith and credit of the government of Israel with a minimum Single "A" rating, or . better,by Standard &Poor's or the equivalent by another NRSRO at the time of purchase 2. Portfolio Composition A maximum of 5% of Available operating Funds may be invested in Israel • Bonds. No Bond Proceeds shall be invested in Israel Bonds. 3. Limits of Individual Issuers Not Applicable. . . 4. Maturity Limitations The maximum length to maturity for State of Israel Bonds shall be 3 years from the date of purchase. • O. Intergovernmental Investment Pool 1. Investment Authorization • Intergovernmental investment pools that are authorized pursuant to the Florida Interlocal Cooperation Act, as provided in Section 163.01, Florida Statutes and have a rating of"AAAm"by Standard&Poor's,or the equivalent by another NRSRO. 2. Portfolio Composition A maximum of 100% of Available Funds may be invested in intergovernmental investment pools. 3. Limits of Individual Issuers • A maximum of 50% of Available Funds may be invested with any one intergovernmental investment pool. 4. Due Diligence Requirements A thorough investigation of any pool fund is required prior to investing and on a quarterly basis. The questionnaire provided in Appendix E must be completed prior to investing.A current prospectus must be obtained prior to investing. • 17 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 P. Florida League of Cities, Inc..Short Term Fixed Income Mutual Funds 1. Investment Authorization Florida League of Cities, Inc.Short Term Fixed Income Mutual Funds 2. Portfolio Composition A maximum of 25% of Available Funds may be invested in the Short Term Fixed Income Mutual Funds 3. Limits of Individual Issuers A maximum of 10%of Available Funds may be invested with any one Florida League of Cities, Inc. Short Term Fixed Income Mutual Fund. 4. Due Diligence Requirements A thorough investigation of the Funds is required prior to investing and on a quarterly basis. The questionnaire provided in Appendix E must be completed prior to investing. A current prospectus must be obtained prior to investing. Xl. DERIVATIVES • Derivatives shall. be utilized only if specifically authorized as part of the investment plan and the CFO or designee has sufficient understanding/expertise to invest in derivatives. All proposed derivative investments (including"SWAPS") will be analyzed by the City's Financial Advisor and will be presented to the Finance and Citywide Projects Committee and the City commission for approval. XII. PROHIBITED INVESTMENTS Funds to be invested in cash management investments may not be invested in the following: Common Stock Private Placements Preferred Stock Convertible Bonds Margin Trading Venture Capital Options and Futures Oil and Gas Wells Warrants Foreign Exchange Short Selling Real Estate Limited Partnerships Commodities Any Inverse Floating Rate Securities Unregistered or Restricted 10 or PO Strips or Inverse Floater Mortgage Backed Stock Securities 18 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 In addition to the above prohibited investments,funds should not be invested in: a) any scrutinized companies with active'business operations in Sudan or Iran as listed by the State Board of Administration (SBA)on a quarterly basis,which is outlined in the Protecting Florida's Investment Act (F.S. 215.442 and 215.473). b) any securities,stocks,or bonds issued by the Government of Venezuela or by any Company that is majority-owned by the Government of Venezuela or securities, stocks, or bonds issued by any institutions or companies doing business in or with the Government of Venezuela or any of its agencies or instrumentalities, in violation of Federal Law. The City Commission may waive the prohibitions in the subsection E (b) if the regime existing in Venezuela as ofJuly 25,2018 collapses and there is an need for immediate aid to Venezuela for Humanitarian reason. XIII. AUTHORIZED INVESTMENT INSTITUTIONS AND DEALERS The City shall only purchase securities from financial institutions, which are qualified as public depositories by the CFO of the State of Florida or from primary dealers (or their agents) as designated by the Federal Reserve Bank of New York and regional dealers who meet the following qualifications and criteria: Qualified Financial Institutions and Securities Dealers A list of qualified financial institutions and securities dealers authorized to provide investment services will be maintained by the Investment Advisor. This list will include approved primary and non-primary dealers. All financial institutions and securities dealers who desire to conduct business with the City must supply the following as appropriate: 1. Most recent audited financial statements(must be provided annually). 2. Proof of State Registration. 3. Certification attesting that the individuals responsible for the City's account have reviewed the City's Investment Policy,that they agree to comply with the Policy, that they agree to undertake reasonable efforts to preclude imprudent transactions involving the City's funds, and that they will disclose potential conflicts or risks that may arise out of business transactions between the City and their organization. However, if the City's investment advisor is responsible for the investment transaction, the City will allow the investment advisor to use their professional judgment for the selection of the appropriate qualified financial institutions and securities dealers. • 4. Executed repurchase agreements, wire transfer agreements, collateral/depository agreements, and other banking services contracts as appropriate. • 19 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Selection Criteria The selection will be accomplished through pn objective rating system which rates financial institutions and securities dealers on both product and performance measures.The selection of firms by the City includes the following evaluation criteria: 1. Financial strength and security of the financial institution or dealer. 2. Institutional and dealer qualifications as they relate to both general and specific product knowledge. 3. Technical support capabilities as well as the operational efficiency of the organization. 4. Ability to provide value-added services. 5. Pricing competitiveness based on the ability to support both the "bid" and "ask"side of various securities market instruments. • An annual review of the financial condition,registration,certification,and contracts of qualified financial institutions and securities dealers will be conducted by the investment advisor. The purpose of this process is to prevent influence being experienced by either City personnel or the financial institution in the selection of the institution chosen for the purchase of City investments. XIV. THIRD-PARTY CUSTODIAL AGREEMENTS All securities purchased by the City under this section shall be properly designated as an asset of the City and held in safekeeping by a third-party custodial bank or other third-party custodial institution, chartered by the United States Government or the State of Florida and no withdrawal of such securities, in whole or in part, shall be made from safekeeping except by the CFO or designee as authorized herein. In addition, it may be found to be appropriate to accept confirmation from the trust company affiliated with the other party of the transaction if the structure of this affiliation is such that the two entities are fully independent of each other,that controls are adequate, and that the City's security interest in the assets is.not lost. Exceptions to this method of control will be the safekeeping of non-negotiable bank certificates of deposit, the Florida State Board of Administration, and various mutual funds which would require physical delivery without systematic handling found commonly with book entry securities. The City will execute third-party custodial agreements with a qualifying institution. Such agreements will include designation of authority from the City, details as to responsibilities of each party, notification of security purchases, sales, delivery, and wire transfers, safekeeping and transaction costs, procedures in case of wire •failure, or other unforeseen conditions including liability of each party. 20 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Delivery vs. Payment All trades,where applicable,will be executed by delivery vs. payment(DVP)to ensure securities are deposited in the eligible financial institution prior to the release of funds.Securities will be held by a third-party custodian as evidenced by safekeeping receipts. XV. TREASURY MANAGEMENT SERVICES MASTER AGREEMENT A "Treasury Management Services Master Agreement" has been developed, reviewed and accepted by the City and is part of the contract established with the City's main depository bank. This agreement is a standard Public Securities Association ("PSA") form agreement offering all recommended protection to the City. This agreement is scheduled to be in effect for the duration of the contract with the City's main depository. XVI. BID REQUIREMENTS Where feasible and appropriate, purchases and sales of securities initiated by the City or the Investment Advisor should generally be accompanied by price quotes from three (3) separate brokers/dealers to ensure the acquisition of market-based prices. Documentation will be retained for all bids,with the winning bid clearly identified.Competitive bids are not applicable in instances'where the City has executed a cash management agreement with an approved institution which addresses the considerations described in the third-party agreement section • above. In certain circumstances where an institution or dealer informs the City or the Investment Advisor that a potential purchase or sale must be completed within minutes of notification,the competitive bidding Policy may be waived, providing the Coro designee specifically approves such individual transactions prior to execution. Periodically, various government agencies announced the issue of new securities to the financial markets. Since all new issues are generally sold at par, the City would not realize any benefit by purchasing these securities through the competitive bid process. In the case of such new issues of"to be announced" (TBA) securities,the competitive bidding process need not apply. • The formal bidding process for investment instruments consists of the following procedures_ (Steps#1 through#4 are performed by Investment Advisor): 1. Maintain a bid list of approximately three (3) major financial institutions qualified under Chapter 280 and two major brokerage firms. This bid list is adjusted periodically to delete bidders who are non-responsive or non-competitive over a period of time,replacing such institution(s)with other qualified institutions which have expressed an interest to bid on City funds. Qualified institutions are defined as financial institutions governed by Chapter 280 of the Florida Statutes with a branch location in Miami-Dade County, Florida. Brokerage houses must maintain an office in Miami-Dade County,Florida and are selected based on the amount of equity in the firm,number of years the firm has been in operation and reputation. 21 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 2. Place telephone calls requesting a bid from each institution on the bid list either on the day of the transaction or the afternoon immediately preceding the transaction date. 3. Receive and note all bids on a standard form designated for this purpose and retain on file for each transaction. 4. Select the highest winning bid 5. Transfer funds in exchange for evidentiary receipt from winning bidder. XVII. INTERNAL CONTROLS The City has established a number if internal controls to prevent loss of funds by fraud, employee error, misrepresentation b third parties,or imprudent actions by employees of the City. The internal controls are as foil•ws: 1. Investment transactions auth•rity is limited to specific persons within the Finance Department. 2. Wire transfer of funds author ty is restricted to specific individuals with specific dollar limits within the Finance Department. All non-repeat type wire transfers require confirmation authorization by : second individual specified in wire authority documents executed with the City's main •epository. 3. All investment transactions re•uire the approval of the Treasury Manager in consultation with the Deputy Finance Dire 'or or CFO. 4. A monthly report is prepared •y the Investment Advisor and distributed to the Treasury Manager early in the subsequ=nt month for review. In addition,the Finance Department receives a copy of this report and reconciles these investments with the City's general ledger on a monthly basis. 5. The Finance Department reco ciles the City's general depository account on a monthly basis by comparing the City's g:neral ledger with the applicable bank account statements. The reconciliation of the gen-ral depository account would reveal any difference in investment transaction record ng and the actual movement of funds. 6. Each month,the Finance Depa tment reconciles investments reflected in the custodial statements with the City's rec.rds. 7. Each year both internal audito s and the City's external auditors review existing internal controls as well as investment ransactions by examining data on a random basis. • 22 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 XVIII. CONTINUING EDUCATION The CFO and any designees shall annually complete eight (8) hours of continuing education in subjects or courses related to investment practices and products. XIX. REPORTING The CFO or designee shall prepare a quarterly investment report, which includes a succinct management summary that provides a clear picture of the status of the current investment portfolio and transactions made over the last quarter.This report will be prepared in a manner which will allow the City to ascertain whether investment activities during the reporting period have conformed to the Policy. The report will include the following: • A listing of individual securities held at the end of the reporting period indicating type, transactions which occurred during the period, paramount (as well as adjusted cost basis), stated yield, maturity date, posted collateral, and actual investment earnings in dollars. • Unrealized gains or losses resulting from appreciation or depreciation by listing the cost and market value of securities over a one-year duration that are not intended to be held under maturity. • Average weighted yield to maturity of the overall portfolio on investments as compared to applicable benchmarks. • The percentage of the total portfolio which each type of investment represents. • The Investment Advisor will provide a statement in the City's quarterly reports as to the whether the City's investments are in compliance with the Policy. Marking-to-Market A statement of the market value of the portfolio shall be issued at least quarterly. This will ensure that the minimal amount of review has been performed on the investment portfolio in terms of value and subsequent price volatility. Review should be consistent with the GFOA Recommended Practice on Marking-to- Market Practices for State and Local Government Investment Portfolios and Investment Pools (see appendix). XX. SECURITIES Every security held on behalf of the City must be properly earmarked and: • If registered with the issuer or its agents, must be immediately placed for safekeeping in a location that protects the City's interest in the security; • If in book entry form, must be held for the credit of the governing body by a depository chartered by the Federal Government, the State of Florida, or any other state or territory of the United States which has a branch or principal place of business in the State of Florida as defined in Florida Statutes, Section 658.12, or by a national association organized and .existing under the laws of the United States which is authorized to accept and exercise trusts and which is doing business in the State of 23 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Florida, and must be kept in the depository in an account separate and apart from the assets of the financial institution; or • If physically issued to the holder but not registered with the issuer or its agents, must be immediately placed for safekeeping in a secured vault. The City may also receive bank trust receipts in return for investment of surplus funds in securities. Any trust receipts received must enumerate the various securities held,together with the specific number of each security held. The actual securities on which the trust receipts are issued may be held by any bank depository chartered by the Federal Government, the State of Florida,or any other state as defined in Section 658.12, Florida State Statutes,or by a national association organized and existing under the laws of the United States which is authorized to accept and execute trusts and which is doing business in the State of Florida. XXI. SALE OF SECURITIES When invested funds are needed in whole or in part for the purposes originally intended or for more optimal investments, the CFO or designee may sell such investments at the then- prevailing market price and place the proceeds into the proper account or fund. XXII. PERFORMANCE MEASUREMENTS In order to assist in the evaluation of the portfolios' performance, the City will use nationally recognized performance measurements ("benchmarks") for the Short-Term and Long-Term portfolios. The use of benchmarks will allow the City to measure its returns against other investors in the same markets. Performance calculations will not include any balances invested in the overnight sweep accounts and savings accounts. Annually, the CFO will review the performance measurements to ascertain their continued relevance based on the composition of the City's portfolio. A. Investment performance of funds designated as short-term funds and other funds that must maintain a high degree of liquidity will be compared to the return on the S&P Rated GIP Index Government 30 Day Yield. Investments of current operating funds shall have maturities of no longer than twenty-four(24) months. B. Investment performance of the Long-Term Portfolio ("Core")will be compared to the BofA Merrill Lynch's 1-3 Year United States Treasury Index or an equivalent index comprised of U. S. Treasury or Government securities. The appropriate index will have a duration and asset mix that approximates the portfolio and will be utilized as a benchmark to be compared to the portfolio's total rate of return. 24 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • XXIII. INVESTMENT COMMITTEE The City may have an Investment Committee that meets on a quarterly basis to discuss the performance of the City's investment portfolios,the compliance of the portfolio with regard to the Policy,and items such as economic and market conditions. The Investment Committee will be made up of members selected by the CFO or designee. XXIV. EXEMPTIONS Any investment held that does not meet the guidelines of this Policy, at the time the Policy is adopted,shall be exempt from the requirements of this Policy.At maturity or liquidation,such • moneys shall be reinvested only as provided by this Policy. XXV. AMENDMENTS This Policy shall be reviewed by the CFO or designee on an annual basis.Any changes must be approved by the CFO or designee, the City Manager, and the City Commission, as well as the individual(s)charged with maintaining internal controls. XXVI. HISTORY OF AMENDMENTS November 18, 1987 Ordinance No. 87-2588 September 16, 1992 Ordinance No. 92-2793 March 15, 1997 Ordinance No.97-3074 • September 27, 1995 Resolution No. 95-21726 March 5, 1997 Resolution No. 97-22315 July 11, 2007 Resolution No. 2007-26602 January 11,2012 • Resolution No. 2012-27816 September 12, 2018 Resolution No. 2018-30482 APPROVED AND ADOPTED BY THE MAYOR AND CITY COMMISSION ON 12-12-2018 RESOLUTION NO. 2018-30923 • • 25 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Appendix A: Section 218.415, Florida Statutes DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 ICI iu,cAI�o ��.,..o�..,.onstltutlon:View Statutes:Online Sunshine • Select Year: 2018 • Go The 2018 Florida Statutes Titlg XIV Chapter 218 View Entire TAXATION AND FINANCIAL MATTERS PERTAINING TO POLITICAL Chapter FINANCE 'SUBDIVISIONS 218.415 Local government investment policies.—Investment activity by a unit of local government must be consistent with a written investment plan adopted by the governing body, or in the absence of the existence of a governing body, the respective principal officer of the unit of local government and maintained by the unit of local government or, in the alternative, such activity must be conducted in accordance with subsection (17). Any such unit of local government shall have an investment policy for any public funds in excess of the amounts needed to meet current expenses as provided in subsections (1)-(16), or shall meet the alternative investment guidelines contained in subsection (17). Such policies shall be structured to place the highest priority on the safety of principal and liquidity of funds. The optimization of investment returns shall be secondary to the requirements for safety and liquidity. Each unit of local government shall adopt policies that are commensurate with the nature and size of the public funds within its custody. (1) SCOPE.—The investment policy shall apply to funds under the control of the unit of local government in excess of those required to meet current expenses. The investment policy shall not apply to pension funds, including those funds in chapters 175 and 185, or funds related to the issuance of debt where there are other existing policies or indentures in effect for such funds. (2) INVESTMENT OBJECTIVES.—The investment policy shall describe the investment objectives of the unit of local government. Investment objectives shall include safety of capital, liquidity of funds, and investment income, in that order. (3) PERFORMANCE MEASUREMENT.—The investment policy shall specify performance measures as are appropriate for the nature and size of the public funds within the custody of the unit of local government. (4) PRUDENCE AND ETHICAL STANDARDS.—The investment policy shall describe the level of prudence and ethical standards to be followed by the unit of local government in carrying out its investment activities with respect to funds described in this section. The unit of local government shall adopt the Prudent Person Rule, which states that: "Investments should be made with judgment and care, under circumstances then prevailing, which persons of prudence, discretion, and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived from the investment." (5) LISTING OF AUTHORIZED INVESTMENTS.—The investment policy shall list investments authorized by the governing body of the unit of local government, subject to the provisions of subsection (16). Investments not listed in the investment policy are prohibited. If the policy authorizes investments in derivative products, the policy must require that the unit of local government's officials responsible for making investment decisions or chief financial officer have developed sufficient understanding of the derivative products and have the expertise to manage them. For purposes of this subsection, a"derivative"is defined as a financial instrument the value of which depends on, or is derived from, the value of one or more underlying assets or index or asset values. If the policy authorizes investments in reverse repurchase agreements or other forms of leverage, the policy must limit the investments to transactions in which the proceeds are intended to provide liquidity and for which the unit of local government has sufficient resources and expertise. http://www.leg.state.fl.us/statutes/index.cfm?App_mode=DIspiay_Statute&URL=0200-0299/0218/Sections/0218.415.html 1/4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 i u,zu i c ..a.,...onstitution:View Statutes:Online Sunshine (6) MATURITY AND LIQUIDITY REQUIREMENTS.—The investment policy shall require that the investment portfolio is structured in such manner as to provide sufficient liquidity to pay obligations as they come due. To that end, the investment policy should direct that, to the extent possible, an attempt will be made to match investment maturities with known cash needs and anticipated cash-flow requirements. (7) PORTFOLIO COMPOSITION.—The investment policy shall establish guidelines for investments and limits on security issues, issuers, and maturities. Such guidelines shall be commensurate with the nature and size of the public funds within the custody of the unit of local government. (8) RISK AND DIVERSIFICATION.—The investment policy shall provide for appropriate diversification of the investment portfolio. Investments held should be diversified to the extent practicable to control the risk of loss resulting from overconcentration of assets in a specific maturity, issuer, instrument, dealer, or bank through which financial instruments are bought and sold. Diversification strategies within the established guidelines shall be reviewed and revised periodically, as deemed necessary by the appropriate management staff. (9) AUTHORIZED INVESTMENT INSTITUTIONS AND DEALERS.—The investment policy should specify the authorized securities dealers, issuers, and banks from whom the unit of local government may purchase securities. (10) THIRD-PARTY CUSTODIAL AGREEMENTS.—The investment policy shall provide appropriate arrangements for the holding of assets of the unit of local government. Securities should be held with a third party; and all securities purchased by, and all collateral obtained by, the unit of local government should be properly designated as an asset of the unit of local government. No withdrawal of securities, in whole or in part, shall be made from safekeeping, except by an authorized staff member of the unit of local government. Securities transactions between a broker- dealer and the custodian involving purchase or sale of securities by transfer of money or securities must be made on a "delivery vs. payment" basis, if applicable, to ensure that the custodian will have the security or money, as appropriate, in hand at the conclusion of the transaction. (11) MASTER REPURCHASE AGREEMENT.—The investment policy shall require all approved institutions and dealers transacting repurchase agreements to execute and perform as stated in the Master Repurchase Agreement. All repurchase agreement transactions shall adhere to the requirements of the Master Repurchase Agreement. (12) BID REQUIREMENT.—The investment policy shall require that the unit of local government's staff determine the approximate maturity date based on cash-flow needs and market conditions, analyze and select one or more optimal types of investment, and competitively bid the security in question when feasible and appropriate. Except as otherwise required by law, the bid deemed to best meet the investment objectives specified in subsection (2) must be selected. (13) INTERNAL CONTROLS.—The investment policy shall provide for a system of internal controls and operational procedures.The unit of local government's officials responsible for making investment decisions or chief financial officer shall establish a system of internal controls which shall be in writing and made a part of the governmental entity's operational procedures.The investment policy shall provide for review of such controls by independent auditors as part of any financial audit periodically required of the unit of local government. The internal controls should be designed to prevent losses of funds which might arise from fraud, employee error, misrepresentation by third parties, or imprudent actions by employees of the unit of local government. (14) CONTINUING EDUCATION.—The investment policy shall provide,for the continuing education of the unit of local government's officials responsible for making investment decisions or chief financial officer. Such officials must annually complete 8 hours of continuing education in subjects or courses of study related to investment practices and products. (15) REPORTING.—The investment policy shall provide for appropriate annual or more frequent reporting of investment activities. To that end, the governmental entity's officials responsible for making investment decisions or chief financial officer shall prepare periodic reports for submission to the legislative and governing body of the unit of local government, which shall include securities in the portfolio by class or type, book value, income earned, and market value as of the report date. Such reports shall be available to the public. (16) AUTHORIZED INVESTMENTS; WRITTEN INVESTMENT POLICIES.—Those units of local government electing to adopt a written investment policy as provided in subsections (1)-(15)may by resolution invest and reinvest any surplus public funds in their control or possession in: http://www.leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0200-0299/0218/Sections/0218.415.html 2/4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 IL/iv:cv 10 ...onstltutlon:View Statutes:Online Sunshine (a) The Local Government Surplus Funds Trust Fund or any intergovernmental investment pool authorized pursuant to the Florida Interlocal Cooperation Act of 1969, as provided in s. 163.01. (b) Securities and Exchange Commission registered money market funds with the highest credit quality rating from a nationally recognized rating agency. (c) Interest-bearing time deposits or savings accounts in qualified public depositories as defined in s. 280.02. (d) Direct obligations of the United States Treasury. (e) Federal agencies and instrumentalities. (f) Rated or unrated bonds, notes, or instruments backed by the full faith and credit of the government of Israel. (g) Securities of, or other interests in, any open-end or closed-end management-type investment company or investment trust registered under the Investment Company Act of 1940, 15 U.S.C. ss. 80a-1 et seq., as amended from time to time, provided that the portfolio of such investment company or investment trust is limited to obligations of the United States Government or any agency or instrumentality thereof and to repurchase agreements fully collateralized by such United States Government obligations, and provided that such investment company or investment trust takes delivery of such collateral either directly or through an authorized custodian. (h) Other investments authorized by law or by ordinance for a county or a municipality. (i) Other investments authorized by law or by resolution for a school district or a special district. (17) AUTHORIZED INVESTMENTS;NO WRITTEN INVESTMENT POLICY.—Those units of local government electing not to adopt a written investment policy in accordance with investment policies developed as provided in subsections (1)-(15) may invest or reinvest any surplus public funds in their control or possession in: • (a) The Local Government Surplus Funds Trust Fund, or any intergovernmental investment pool authorized pursuant to the Florida Interlocal Cooperation Act of 1969, as provided.in s. 163.01. (b) Securities and Exchange Commission registered money market funds with the highest credit quality rating from a nationally recognized rating agency. (c) Interest-bearing time deposits or savings accounts in qualified public depositories, as defined in s. 280.02. (d) Direct obligations of the U.S.Treasury. The securities listed in paragraphs (c) and (d) shall be invested to provide sufficient liquidity to pay obligations as they come due. (18) SECURITIES; DISPOSITION.— (a) Every security purchased under this section on behalf of the governing body of a unit of local government must be properly earmarked and: 1. If registered with the issuer or its agents, must be immediately placed for safekeeping in a location that protects the governing body's interest in the security; 2. If in book entry form, must be held for the credit of the governing body by a depository chartered by the Federal Government, the state, or any other state or territory of the United States which has a branch or principal place of business in this state as defined in s. 658.12, or by a national association organized and existing under the laws of the United States which is authorized to accept and execute trusts and which is doing business in this state, and must be kept by the depository in an account separate and apart from the assets of the financial institution; or 3. If physically issued to the holder but not registered with the issuer or its agents, must be immediately placed for safekeeping in a secured vault. (b) The unit of local government's governing body may also receive bank trust receipts in return for investment of surplus funds in securities. Any trust receipts received must enumerate the various securities held, together with the specific number of each security held.The actual securities on which the trust receipts are issued may be held by any bank depository chartered by the Federal Government, this state, or any other state or territory of the United States which has a branch or principal place of business in this state as defined in s. 658.12, or by a national association organized and existing under the taws of the United States which is authorized to accept and execute trusts and which is doing business in this state. http://www.leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0200-0299/0218/Sections/0218.415.html 3/4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 la I ui u io ICILY MO a..onstitution:View Statutes:Online Sunshine (19) SALE OF SECURITIES.—When the invested funds are needed in whole or in part for the purposes originally intended or for more optimal investments, the unit of local government's governing body may sell such investments at the then-prevailing market price and place the proceeds into the proper account or fund of the unit of local government. (20) PREEXISTING CONTRACT.—Any public funds subject to a contract or agreement existing on October 1, 2000, may not be invested contrary to such contract or agreement. (21) PREEMPTION.—Any provision of any special act, municipal charter, or other law which prohibits or restricts a local governmental entity from complying with this section or any rules adopted under this section is void to the extent of the conflict. (22) AUDITS.—Certified public accountants conducting audits of.units of local government pursuant to s. 218.39 shall report, as part of the audit, whether or not the unit of local government has complied with this section. (23) AUTHORIZED DEPOSITS.—In addition to the investments authorized for local governments in subsections (16)and (17)and notwithstanding any other provisions of law, a unit of local government may deposit any portion of surplus public funds in its control or possession in accordance with,the following conditions: (a) The funds are initially deposited in a qualified public depository, as defined in s. 280.02, selected by the unit of local government. (b) The selected depository arranges for depositing the funds in financial deposit instruments insured by the Federal Deposit Insurance Corporation in one or more federally insured banks or savings and loan associations, wherever located, for the account of the unit of local government. (c) The full amount of the principal and accrued interest of each financial deposit instrument is insured by the Federal Deposit Insurance Corporation. (d) The selected depository acts as custodian for the unit of local government with respect to each financial deposit instrument issued for its account. History.—s. 1,ch.95-194;s.2,ch.97-9;s.3,ch.2000-264;ss.66, 141,ch.2001-266;s.2,ch.2005-126;s. 1,ch.2007-89;s.42,ch. 2008-4;s.2,ch.2009-140. Copyright©1995-2018 The Florida Legislature• Privacy Statement • Contact Us • • http:l/www.leg.stateRuslstatutesMdex.cfm?App_mode=Display_Statute&URL=0200-0299/0218/Sections/0218.415.html 4/4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Appendix B: GFOA Recommended Practices DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 LI I UIGU 1 o cawun3T'ing a Policy for Repurchase Agreements Government Finance Officers Association E P '16 '1\CT C E Establishing a Policy for Repurchase Agreements BACKGROUND: Where permitted by statute and investment policy,governmental entities often enter into Repurchase Agreements(repos)to invest funds on a short-term basis primarily to fund liquidity needs. Repos are contractual financial transactions in which an investor(e.g.governmental entity)purchases securities from a bank or dealer with a simultaneous contractual agreement by both parties to reverse the transaction at the same price(plus interest)at some mutually agreed-upon future date.The parties to the agreement(governmental entity and bank/dealer)are commonly referred to as counterparties. Repos are an integral part of an investment program of state and local governments and provide an alternative or supplement to local government investment pools, money market mutual funds and other money market instruments. However,like all investments,there are associated risks with repos,one in particular is the counterparts credit risk.Such risk can be mitigated by the utilizing proper securitization practices. Common Types of Repos: • Overnight Repo:refers to a repo that goes from one business day to the next business day. These repos have a negotiated fixed interest rate. • Term Repo:refers to a repo agreement with a specified maturity of several days to several weeks.Term repos can be established for up to several years when the investment policy permits.The interest rate for the period is usually fixed. • Open Repo:typically,has no maturity date,and renews daily until terminated by either one of the counterparties.The interest rate adjusts daily to the overnight rate and is averaged for the period of the repo. • Flex Repo(flexible repurchase agreements):are often used for the reinvestment of bond proceeds used for capital projects.These repos are often for multi-year periods associated with a specific capital program.The flexible portion of the agreement permits multiple cash draw-downs to fund the expenditure requirement.Governments should ensure that these investments meet the liquidity requirements of the project and adhere to any bond covenants. • Tri-Party Repo:occurs when a custodian(a.k.a.the tri-party agent)participates as an intermediary between the two parties(investor and lender)of the repo.The custodian administers and ensures the transaction occurs simultaneously and that necessary safeguards are in place to protect the underlying securities during term of the repo. Benefits of Repos: • Repos are safe when properly established and monitored; • At times, provide higher yields than other money market alternatives; • Provide diversification to other money market investments;and http://www.gfoa.org/print/572 1/4 DocuSign o S g`Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C Oo1./ 01iing a Policy for Repurchase Agreements • Provides flexibility. Risks Associated with Repos: • The repurchase agreement with an entity's counterparty is not properly established; • The financial strength of the counterparties and value of the collateral are not properly monitored; • The bank or dealer cannot buy securities back when repo is closed by governmental entity. • The collateral for the repo is not liquid or easily marketable;and • The value of the repo is not sufficient to cover the funds invested and interest earned. Mitigating the Risk: • Execute a SIFMA Master Repurchase Agreement including additional provisions specific to the governmental agency that is signed by a duly authorized officer with each counterparty; • Establish financial strength criteria for counterparties and review financial statements at inception of relationship and at least annually.Some entities will limit counterparties to primary dealers; • Allow only highly marketable,easily priced collateral priced at a minimum of 102%and monitoring their value at least weekly;and • Have collateral settled delivery-versus-payment(DVP)at the entity's custodian or trustee for third-party safekeeping. Master Repurchase Agreement.A Master Repurchase Agreement is the contractual agreement a governmental entity enters into with a bank or counterparty.A form of the agreement,also known as a blanket agreement may be obtained from the website of the Securities Industry and Financial Markets Association(SIFMA)formerly known as The Bond Market Association(TBMA). However, governmental entities may wish to amend SIFMA's form of the Master Repurchase Agreement to suit the specificities of their respective transactions. A master repurchase agreement governs the repurchase transaction.An agreement should reflect the following characteristics: • Defines and provides detail as to the nature of the transaction; • Identifies the relationship of the parties to the agreement; • Establishes the parameters concerning the ownership and custody of the collateral securities for the term of the agreement; • May include right to substitute collateral during the term of the agreement;and • Provides for remedies in the event of default by either party. SIFMA has also published an optional substitution/termination provision to its Master Repurchase Agreement that allows the repo seller(bank or dealer)to retain effective control over the purchased securities,or the repo seller could elect to terminate the transaction prior to maturity on short notice to the repo buyer(government entity). Securitization Provisions. Safekeeping: In order to protect public funds,governmental entities should ensure proper securitization practices when utilizing repurchase agreements for investments.Safekeeping should be performed by an independent or third-party custodian. Duties of the custodian(direct or tri-party) should be outlined in a written safekeeping agreement. Collateral:The underlying security of a repurchase agreement is collateral.Collateral arrangements for repurchase agreements are short-term and liquid in nature.Typical collateral instruments are U.S.Treasuries(e.g. U.S.Treasury bills)and governmental agency securities(e.g.Farm Credit Banks,Home Loan Banks bonds).Governmental entities should be aware of the risk factors of the http://www.gfoa.orglprint/572 2/4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 u IUI V 10 cbtdunsiIing a Policy for Repurchase Agreements underlying collateral instrument for the repo and refer to their respective investment policies to verify if such collateral instruments are permissible to utilize for the repurchase transaction.The purchased securities(collateral)to collateralize the repurchase agreement should maintain a market value in excess of the value of the repurchase agreement(called margin,"haircut,"or over securitization). Although governmental entities are not bound by the Financial Accounting Standards Board(FASB), FASB Statement No.140 affects the counterparties to repurchase transactions with governments. FASB Statement No. 140,"Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities,"generally provides that if the repo buyer(i.e.,government entity)has the right to sell or substitute the securities,then the repo seller(i.e., bank or dealer)does not have the right to substitute the securities or terminate the contract on short notice.The repo buyer will be obligated to record both the securities,together with any obligation to return the securities.The repo seller will be required to reclassify the securities from a securities inventory or investment account to a securities collateral account on its balance sheet.Accordingly,the nature of the underlying repurchase agreement may change from a buy-sell transaction to a collateralized loan.This change of treating repurchase agreements as collateralized loans would make them illegal for local governments in many states. RECOMMENDATION: GFOA recommends that state and local government finance officers develop policies and procedures to ensure the safety of repos. The following actions are recommended: 1.Govemment entities and investment officers should exercise special caution in selecting and evaluating the creditworthiness of counterparties with whom they will conduct repurchase transactions and be able to identify the parties acting as principals to the transaction. 2.Master repurchase agreements should be employed,subject to appropriate legal and technical review. Governments using the prototype agreement developed by SIFMA should include appropriate supplemental provisions regarding the types of securities,delivery, substitution,margin maintenance, margin amounts,seller representations,and governing law as contained in the GFOA-developed Considerations for Governments in Developing a Master Repurchase Agreement. 3.Government entities'legal department should review SIFMA's optional substitution/termination provision in its master agreement to assure no loss has incurred (e.g. in event of a default). In jurisdictions where substitution of securities is permitted,a loss provision is provided that is intended to place the repo buyer in the same position it would have been had the repo seller not exercised the substitution/termination right. However,in jurisdictions where substitution Is restricted,the effect of FASB Statement No.140 may be troublesome depending on the relationship established with the bank or dealer;the jurisdiction's position with respect to the change in accounting treatment of the transaction; and whether the government has the ability to avoid the restriction on substitution of purchased securities. 4.Proper securitization practices are necessary to protect the public funds invested in repurchase agreements. Safekeeping duties should be performed by a third-party custodian in accordance with an executed agreement.The purchased securities(collateral)to coilateralize the repurchase agreement should maintain a market value in excess of the value of the repurchase agreement(called margin,"haircut,"or over securitization). Routine market valuing of the purchased securities during the term of the repurchase agreement should be a mandatory practice in order to ensure the purchased securities maintain sufficient market value to cover any default.A typical margin requirement for a short-term repo using US Treasuries or US agency securities as collateral is at least 102%and higher(typically 105%) for other securities. http://www.gfoa.org/print/572 3/4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 u I uicu a Policy for Repurchase Agreements 5.Consideration should be given to restricting the allowable securities that are used for . collateral. Entities may prefer to only allow for security maturity and security types that are allowable for direct investment under their policy.If there is a default of the counterparty,the securities held as collateral of the repo will be owned by the entity,supporting the need to restrict the maturity and type of security to what is allowable under policy. References: • "Do You Know Your Repurchase Agreements as Well as You Think?"GFOA's Treasury Management Newsletter,October 3,2009,Volume 27,Number 10. • An Introduction to Broker-Dealers for State and Local Governments, Second Edition,Sofia Anastopoulos,GFOA,2008. • "GFOA Best Practice,Securities Lending Programs"(1995,2002,2008). • An Introduction to Collateralizing Public Deposits for State and Local Governments, Second Edition, M.Corinne Larson,GFOA,2006. • GFOA Best Practice, Frequency of Purchased Securities Valuation in Repurchase Agreements(1999,2003,2006,2008). • Investing Public Funds, Second Edition,Girard Miller with M. Corinne Larson and W. Paul Zorn,GFOA, 1998. • "GFOA Best Practice,Securities Lending Programs"(1995,2002,2008).. • Sample Custodial Trust Agreement,GFOA. • FASB Statement 140,"Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities,"http://www.fasb.org/pdf/fas140.pdf. • The Securities Industry and Financial Markets Association(SIFMA)http://www.sifma.org 203 N.LaSalle Street-Suite 2700 I Chicago,IL 60601-1210 I Phone:(312)977-9700-Fax:(312)977-4806 http://www.gfoa.org/print/572 4/4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 -iu!me io Collateralizing Public Deposits Government Finance Officers Association E Collateralizing Public Deposits BACKGROUND: The safety of public funds should be the foremost objective in public fund management. Collateralization of public deposits through the pledging of appropriate securities or other instruments(i.e.surety bonds or letters of credit)by depositories is an important safeguard for such deposits.The amount of pledged collateral is determined by a governmental entity's deposit level and the policy or legal required collateral margin.Some states have established programs for the • pooling of collateral for deposit of public funds. Federal law imposes certain limitations on collateral agreements between financial institutions and public entities in order to secure governmental entity deposits.Under certain circumstances,as are discussed in recommendations below,the Federal Deposit Insurance Corporation(FDIC)may void an otherwise perfected security interest and leave the governmental depositor.with only the right to share with other creditors in the pro rata distribution of the assets of a failed Institution for the amount of deposits that exceed the FDIC coverage.Separate governmental'corporations'such as economic development corporations or water supply corporations,etc.,do not fulfill the FDIC's definition of 'public unit'1 and therefore even accurately completed collateral definition may not be honored by the FDIC on a bankruptcy. RECOMMENDATION: GFOA recommends the use of a written agreement with pledging requirements as protection for state or local government's deposits.GFOA encourages governmental entities to establish adequate and efficient administrative systems to monitor such pledged collateral,including state or locally administered collateral pledging or collateral pools.To accomplish these goals, GFOA recommends the following: 1.Governmental entities should implement programs of prudent risk control.Such programs could include a formal depository risk policy,credit analysis,and use of fully secured investments. In the absence of a state program for pooling collateral, public entities should establish and implement collateralization procedures,including procedures to monitor their collateral positions.Monitoring informs a public entity of undercollateralization,which may threaten the safety of an entity's deposits, and overcollateralization,which may increase the cost of banking services.Governmental entities however can not and should not accept the liability for maintaining collateral levels which liability must fall to the financial institution. 2.Governmental entities/depositors should take all possible actions to comply with state and federal requirements in order to ensure that their security interests in collateral pledged to secure deposits are enforceable against the receiver of a failed financial institution. Federal law provides that a depositor's security agreement,which tends to diminish or defeat the interest of the FDIC in an asset http://www.gfoa.org/print/570 1/3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 u 1 ur[ui n Collateralizing Public Deposits acquired by it as receiver of an insured depository,shall not be valid against the FDIC unless the • agreement: o is in writing; o was approved by the board of directors of the depository or its loan committee and2 o has been, continuously,from the time of its execution,an official record of the depository institution.3 3.Governmental entities should have all pledged collateral held at an independent third-party institution outside the holding company of their bank,and evidenced by a written agreement in an effort to satisfy the Uniform Commercial Code(UCC)requirement for control.The UCC states that the depositor does not have a perfected interest in a security unless the depositor controls it.Control means that swaps,sales,and transfers cannot occur without the depositor's written approval. o The value of the pledged collateral should be marked to market monthly,or more frequently depending on the volatility of the collateral pledged.Some state statutes do dictate a minimum margin level for collateral based on deposit levels(e.g.,Georgia and Minnesota statutes require 110 percent). If not,the margin levels should be at least 102 percent,depending on the liquidity and volatility of the collateral pledged. State statutes also govern whether minimum margin levels apply to principal only or to accrued interest as well.On a sale,accrued interest would be received.Governmental entitles should review applicable state statutes and confirm compliance. o Substitutions of collateral should meet the requirements of the collateral agreement,be approved,by the entity in writing prior to release,and the collateral should not be released until the replacement collateral has been received. o The public entity should require reporting directly from the custodian.The custodian should warrant and be signatory to the agreement o Reporting by the third party institution should at a minimum be monthly. 4.The pledge of collateral should comply with the investment policy or state statute,whichever is more restrictive. Governmental entities should know and understand securities pledged as collateral. 5.Governmental entities that use surety bonds in lieu of collateral should limit the insurers to those of the highest credit quality as determined by a nationally recognized insurance rating agency.A thorough review of the terms of the bond is required. 6.The governmental entity should thoroughly review the terms and conditions of any letters of credit, including those issued by a federal agency or government sponsored enterprise. 7.The governmental entity should establish and follow procedures for on-going review of collateral. Note:As a result of the court case North Arkansas Medical Center v.Barrett,963 F.2d 780(8th Cir. 1992),the FDIC issued a policy statement in March 1993 indicating that it would not seek to void a security interest of a federal,state,or local public unit solely because the security agreement did not comply with the contemporaneous execution requirement set forth in Section 13(e)of the Federal Deposit Insurance Act 12 U.S.C.1823(e).The policy statement was officially enacted by Section 317 of the Riegle Community Development and Regulatory Improvement Act of 1994(Public Law 103- 325). • Notes: 1 For deposit insurance purposes,the term"public unit"includes a state,county, municipality,or "political subdivision"thereof.Governments should review Section 330.15 of the FDIC's regulations (12 C.F.R.330.15)to identify if they fall within the FDIC's definition of"public unit"and to determine http:/lwww.gfoa.org/print/570 2/3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 iu iu,cu io Collateralizing Public Deposits whether they are public entity qualifying for collateral protection under the definition.This information can be found at http://www.fdic.gov/deposit/deposits/FactSheet.html 2 The FDIC does not require every transaction to be reviewed by the board of directors.The board may fulfill this function by setting parameters and authorizing a particular officer to carry out its wishes.The officer would be performing ministerial acts on behalf of the board.(FDIC Interpretive Letters) 3 Corporate resolutions that list specific officers who are authorized by the board of directors to execute agreements securing public deposits will meet this requirement. References: • GFOA Sample Security Agreement(long and short versions),www.gfoa.org,2009. • GFOA Sample Custodial Trust Agreement,www.gfoa.org,2006. • An Introduction to Collateralizing Public Deposits for State and Local Governments,Second Edition, M.Corinne Larson,GFOA,2006. • Investing Public Funds, Second Edition,Girard Miller with M.Corinne Larson and W.Paul Zom,GFOA, 1998. • FDIC Act(12 U.S.C. 1811 et seq.and 12 C.F.R. Part 330.330.15 Public Unit Accounts (www.FDIC.gov) 203 N.LaSalle Street-Suite 2700 I Chicago,IL 60601-1210 I Phone:(312)977-9700-Fax:(312)977-4806 http://www.gfoa.org/print/570 3/3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 ,L,I V/cV., you iy...ual Funds for Cash Management Purposes Government Finance Officers Association • • top ,Njo 4 ,.../TicE Using Mutual Funds for Cash Management Purposes BACKGROUND: State and local government cash managers may benefit from investing public monies through mutual funds. Mutual funds are SEC-regulated investment instruments that pool and jointly invest monies of multiple investors.Mutual funds are available for both fixed income and equity investments. Short-term liquid fixed income mutual funds that maintain a weighted average maturity of 60 days or less and have a stated aim to maintain investor shares with a constant one dollar($1)Net Asset Value(NAV)are called money market mutual funds.While these funds seek to maintain a constant or stable NAV,this is not guaranteed and investors of public monies should be aware of this risk. Other non-money market fixed income mutual funds generally have a longer-term weighted average maturity and also have a fluctuating price or NAV. The Government Finance Officers Association(GFOA)has endorsed the use of money market mutual funds by public cash managers in the past. Portfolio safety, liquidity,diversification,and professional management are desirable features of these investment vehicles;however,liquidity may be impaired by the floating NAV. RECOMMENDATION: The GFOA recommends that state and local governments restrict their use of mutual funds for cash management purposes exclusively to:(1)money market mutual funds that are invested in Treasury, federal government agency, or first tier categories and possess the highest ratings available from at least one nationally-recognized ratings agency and(2)short-term bond funds that receive the highest credit quality ratings and the lowest risk ratings available. Risk Assessment.When analyzing risk,the following should be taken into consideration: 1.Local Investment Policy.State and local government cash managers should exercise prudence and caution when investing in short-term bond funds. Public cash managers should also check applicable statutes to determine if the use of money market mutual funds and/or short-term bond funds is permitted within their jurisdictions. 2.Fund Prospectus. Before investing,governments should review and understand a fund's prospectus and statement of additional information to determine: 1. Portfolio composition; 2.Risk characteristics; 3.The duration and weighted average maturity of the mutual fund; 4.The reputation and experience of the investment company; 5.The performance history relative to appropriate benchmarks; • http://www.gfoa.org/print/3561 1/2 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 1 t1 UFZu1 o using mutual Funds for Cash Management Purposes 6.Total expense ratio; 7.Philosophy,strategies,and portfolio policies; 8.If the fund is rated by a nationally recognized rating agency;and 9.Whether the fund can meet the compliance requirements of the government's approved investment policy. Cash managers should continue to monitor these characteristics as they may change over time. 0 _ 3.Restriction on Redemptions(Gates). Prior to investing in a money market mutual fund, cash managers should familiarize themselves with any restriction gates assessed against the fund which could impair the ability of an entity to withdraw monies from the fund on a timely basis in order to meet current liquidity requirements. 4.Fees. During extremely low interest rate environments,mutual fund expenses may exceed yield.While fees are included in all mutual funds,these fees should be considered when investing in mutual funds. Investors should assess the risk that the net yield(gross yield minus expenses)will be less than zero—in some cases it may be more beneficial to own the underlying securities directly. 5.Duration.Bond funds investing in shorterm instruments,with a varying NAV,may be legal and appropriate investments in some jurisdictions when monies are not needed for near-term • disbursement. However,mutual funds of an intermediate or long-term duration should be avoided by investors if short-term liquidity is a concern. 6.Holdings. Investors should review the specific holdings of their mutual fund at least monthly to know what underlying securities the fund owns. Prime money market funds that are AAA rated and hold A1+paper may have foreign debt exposure that is not obvious. In addition, Investors should review the NAV at least monthly. If the NAV varies below$0.995(known as "breaking the buck"), investors should reevaluate their investments in these funds. Governments should consider investing in'money market funds that Invest in US government securities,which have a higher level of safety and will not be subject to the floating NAV. References: • GFOA Best Practice—Managing Market Risk in Investment Portfolios • An Introduction to Investment Advisers for State and Local Governments, Second Edition, Sofia Anastopoulos,GFOA,2007. • A Public Investor's Guide to Money Market Instruments,Second Edition,edited by M.Corinne Larson, GFOA, 1994. • Investing Public Funds, Second Edition, Girard Miller with M. Corinne Larson and W.Paul Zorn, GFOA, 1998. 203 N.LaSalle Street-Suite 2700 I Chicago,IL 60601-1210 I Phone:(312)977-9700-Fax:(312)977-4806 http://www.gfoa.org/print/3561 2/2 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 .I u.i V/LU 1 o uv ...,,gent Relationships with Securities Dealers Government Finance Officers Association R 4 '-,TicE tip Government Relationships with Securities Dealers BACKGROUND: Finance officers,treasurers and investment officers(hereafter referred to as government investors) who manage and invest public funds place billions of dollars in the fixed-income and money markets on a daily basis.They have a fiduciary responsibility to protect public funds,to always act in the best interest of their entity,to maintain safety and an appropriate level of liquidity and to attain a competitive return on their portfolio. Generally,access to the securities markets is made through securities dealers who are registered broker/dealers and through financial institutions(banks)with broker/dealer subsidiaries.The fiduciary responsibilities of a government investor include ensuring that: • reasonable comparisons are made to judge the appropriateness of all investments; • securities meet the criteria established in the investment policy,including liquidity,diversity and risk of investments; • security transactions are made on a best execution basis through a competitive process; • the counterparty to the transaction will fulfill all of Its obligations;and, • the securities are properly safe-kept at a qualified custodial agent in a segregated account. It is important to note that,brokers/firms may have unique strengths that may provide exceptional value within a specific category of investments,provided that you understand the security that you are purchasing,it dovetails with your investment policy,and you are aware of the risks associated with the transaction. A unique strength may compliment the skills and abilities of other approved brokers/firms. Communication with broker/dealers for the purposes of discussing market conditions,reviewing investment strategies and transacting a trade often occurs by phone,e-mail,or fax. Regardless of the method of communicating with a broker,a government investor needs to perform due diligence on all securities dealers prior to adding them to their list of approved brokers/dealers for transacting trades. RECOMMENDATION: GFOA makes the following specific recommendations to government investors in selecting securities dealers for their approved vendor list, managing the relationships with the broker/dealers,and conducting investment transactions with them: 1.All securities are held in a third party bank separate from the broker/dealer that is transacting business. http://www.gtoa.org/print1577 1/3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 i ,iu,Lu 10 t Relationships with Securities Dealers 2.Use a defined internal process to select,qualify, renew,or terminate brokers and dealers. 1. Use a questionnaire,conduct an interview,and/or conduct peer references to help determine that the broker understands the public entity's needs/objectives. 2.Determine that the broker is actively involved in the market sectors utilized by the government entity. 3.Select a number of brokers suitable to the entity,allowing for appropriate competition/service on all transactions,while limiting it to a manageable number. 4.Require security brokers and dealers to comply with the Federal Reserve Bank of New York's capital adequacy guidelines or SEC Net Capital Rule as a condition of doing business.Obtain annual financial reports of the securities firm. 5.Require that brokers provide written acknowledgement or certification of their review and understanding of the government entity's investment policy to assure compliance with its objectives, portfolio risk constraints,and investment trading requirements. 6. Record and retain pertinent information on the firm and the individual broker including an annual review of the Central Registration Depository(CRD®)Information for both maintained by the Financial Industry Regulation Authority(FINRA). Violations or sanctions imposed by a regulatory agency or government should be carefully reviewed for termination of relationship. • 7.Establish parameters that guide periodic review and potential termination of a broker dealer relationship. 8.Do not select or approve more broker/dealers than will be reasonably used. It is better to develop good relationships with a small number of approved dealers than to have a long list of firms who transact little or no business with the investing entity. 3.Due diligence on broker/dealers should include obtaining information on: 1.a security dealer's experience and knowledge of public funds investing; 2.all contact information for the primary contact,backup and operations staff; 3.a broker's manager and supervisor; 4.the financial strength of the firm; 5.areas of expertise and trading activity; 6.registration with FINRA and any citations; 7.the names and contact information for references similar to the entity;and 8.potential conflicts of interest. 4.Establish a competitive procedure for attaining reasonable market rates on investment transactions: 1.Require that all security sales be made through a competitive bid process. If possible, use a competitive offer process on purchases as well. 2.Securities sold through a selling group at a set price(usually par)or available for specific bidding should be compared to comparable maturity securities as part of the competitive process to determine the best relative value. 5.Require that all security transactions be settled on a delivery versus payment basis at the entity's custodian bank to perfect ownership under a written custodial agreement. 6. Retain complete transaction documentation for audit trail purposes including trade tickets, confirmations and safekeeping receipts. 7.Electronic trading platforms,such as Bloomberg and Tradeweb,are becoming another alternative to competitive pricing. These platforms can provide improved transparency over competitive bids and should be considered if cost effective for the government. It is still important to have a broker assigned to the account on the electronic platforms so that contact can be made if necessary. The same due diligence should be completed with all broker dealers on the electronic platforms. 8.Follow all state and entity ethics policies when dealing with all broker/dealers and investment vendors. References: http://www.gfoa.org/print/577 2/3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 �znurzuia uovernment Relationships with Securities Dealers • Introduction to Broker-Dealers for State and Local Governments,Second Edition,Sofia Anastopoulos, GFOA,2008. • Investing Public Funds,Second Edition,Girard Miller with M.Corinne Larson and W. Paul Zorn,GFOA, 1998. • Federal Reserve Bank of New York,www.frb.ny.gov, http://www.newyorkfed.org/markets/pridealers_listing.html. • WWW.FINRA.GOV;http://www.nasd.com/web/idcplg? IdcService=SS_GET PAGEBinodeld=370. • Securities and Exchange Commission,www.sec.gov,VI. Financial Responsibility of Broker Dealers,A. Net Capital Rule 15c3-1 (17 CFR 240.15c3-1) http://www.sec.gov/divisions/marketreg/bdguide.htm#V1. 203 N.LaSalle Street-Suite 2700 I Chicago,IL 60601-1210 I Phone:(312)977-9700-Fax:(312)977-4806 http://www.gfoa.org/print/577 3/3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Appendix C: Investment Firm Certification Form DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 INVESTMENT FIRM CERTIFICATION FORM As an authorized representative of the undersigned firm,I hereby certify that the firm has in place reasonable procedures to monitor the activities of this firm engaged in transactions between our firm and the City of Miami Beach. All sales personnel of this firm dealing with the City of Miami Beach have been informed and will be routinely informed of the City's. investment objectives,policies,risk constraints and other pertinent factors,whenever we are so informed.This firm further pledges due diligence in informing the City of foreseeable risks associated with financial transactions connected with this firm. (Firm) • Authorized Representative (Signature) (Title) (Name- Printed) (Date) As account representative for the City on behalf of the above referenced firm I hereby certify that I have personally read and understand that investment policies of the City, in such form as the policies were provided to me. I agree to use my best efforts to comply with the City's written policies and will not knowingly enter into any transaction with the City, which appears to be in violation of the City's written policies. Account Representative (Signature) (Title) • (Name- Printed) (Date) DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Appendix D: Master Repurchase Agreement DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Appendix E: Investment Pool/Fund Questionnaire DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 • Investment Pool/Fund Questionnaire 1. A description of eligible investment securities, and a written statement of investment policy and objectives. 2. A description of interest calculations and how it is distributed, and how gains and losses are treated. 3. A description of how the securities are safeguarded (including the settlement processes), and how often the securities are priced, and the program audited. 4. A description of who may invest in the program, how often, what size deposit and withdrawal are allowed. 5. A schedule for receiving statements and portfolio listings. 6. Are reserves, retained earnings, etc. utilized by the pool/fund? 7. A fee schedule, and when and how is it assessed. 8. Is the pool/fund eligible for bond proceeds and/or will it accept such proceeds? DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Appendix F: Glossary of Cash and Investment Management Terms DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 The following is a glossary of key investing terms,many of which appear in the City's investment policy. This glossary clarifies the meaning of investment terms generally used in cash and investment management. This glossary has been adapted from the GFOA Sample Investment Policy and the Association of Public Treasurers of the United States and Canada's Model Investment Policy. Accrued Interest. Interest earned but which has not yet been paid or received. Agency. See "Federal Agency Securities." Ask Price. Price at which a broker/dealer offers to sell a security to an investor. Also known as "offered price." Asset Backed Securities (ABS). A fixed-income security backed by notes or receivables against assets other than real estate. Generally issued by special purpose companies that "own" the assets and issue the ABS. Examples include securities backed by auto loans, credit card receivables, home equity loans, manufactured housing loans, farm equipment loans, and aircraft leases. Average Life. The average length of time that an issue of serial bonds and/or term bonds with a mandatory sinking fund feature is expected to be outstanding. Bankers' Acceptance (BA's). A draft or bill of exchange drawn upon and accepted by a bank. Frequently used to finance shipping of international goods. Used as a short-term credit instrument, bankers' acceptances are traded at a discount from face value as a money market instrument in the secondary market on the basis of the credit quality of the guaranteeing bank. Basis Point. One hundredth of one percent, or 0.01%. Thus 1% equals 100 basis points. Bearer Security. A security whose ownership is determined by the holder of the physical . security. Typically, there is no registration on the issuer's books. Title to bearer securities is transferred by delivery of the physical security or certificate.Also known as"physical securities." Benchmark Bills: In November 1999, FNMA introduced its Benchmark Bills program, a short- term debt securities issuance program to supplement its existing discount note program. The program includes a schedule of larger,weekly issues in three-and six-month maturities and biweekly issues in one-year for Benchmark Bills. Each Issue is brought to market via a Dutch (single price) auction. FNMA conducts a weekly auction for each Benchmark Bill maturity and accepts both competitive and non-competitive bids through a web based auction system. This program is in addition to the variety of other discount note maturities, with rates posted on a daily basis,which FNMA offers. FNMA's Benchmark Bills are unsecured general obligations that are issued in book-entry form through the Federal Reserve Banks. There are no periodic payments of interest on.Benchmark Bills,which are sold at a discount from the principal amount and payable at par at maturity. Issues under the Benchmark program constitute the same credit standing as other FNMA discount notes;they simply add organization and liquidity to the short-term Agency discount note market. 1 • DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Benchmark Notes/Bonds: Benchmark Notes and Bonds are a series of FNMA"bullet"maturities (non-callable) issued according to a pre-announced calendar. Under its Benchmark Notes/Bonds program, 2, 3, 5, 10, and 30-year maturities are issued each quarter. Each Benchmark Notes new issue has a minimum size of $4 billion, 30-year new issues having a minimum size of $1 billion, with re-openings based on investor demand to further enhance liquidity.The amount of non-callable issuance has allowed FNMA to build a yield curve in Benchmark Notes and Bonds in maturities ranging from 2 to 30 years. The liquidity emanating from these large size issues has facilitated favorable financing opportunities through the development of a liquid overnight and term repo market. Issues under the Benchmark program constitute the same credit standing as other FNMA issues;they simply add organization and liquidity to the intermediate-and long-term Agency market. Benchmark. A market index used as a comparative basis for measuring the performance of an investment portfolio. A performance benchmark should represent a close correlation to investment guidelines, risk tolerance, and duration of the actual portfolio's investments. Bid Price. Price at which a broker/dealer offers to purchase a security from an investor. Bond. Financial obligation for which the issuer promises to pay the bondholder(the purchaser or owner of the bond) a specified stream of future cash-flows, including periodic interest payments and a principal repayment. Book Entry.Securities. Securities that are recorded in a customer's account electronically through one of the financial markets electronic delivery and custody systems,such as the Fed Securities wire, DTC, and PTC (as opposed to bearer or physical securities). The trend is toward a certificate-free society in order to cut down on paperwork and to diminish investors' concerns about the . certificates themselves. The vast majority of securities are now book entry securities. Book Value. The value at which a debt security is reflected on the holder's records at any point in time. Book value is also called "amortized cost" as it represents the original cost of an investment adjusted for amortization of premium or accretion of discount. Also called "carrying value." Book value can vary over time as an investment approaches maturity and differs from "market value" in that it is not affected by changes in market interest rates. Broker/Dealer. A person or firm transacting securities business with customers.A"broker"acts as an agent between buyers and sellers and receives a commission for these services.A"dealer" buys and sells financial assets from its own portfolio. A dealer takes risk by owning inventory of securities, whereas a broker merely matches up buyers and sellers. See also "Primary Dealer." Bullet Notes/Bonds. Notes or bonds that have a single maturity date and are non-callable. Call Date. Date at which a call option may be or is exercised. Call Option. The right, but not the obligation, of an issuer of a security to redeem a 2 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1 A2C0 • security at a specified value and at a specified date or dates prior to its stated maturity date. Most fixed-income calls are at par but can be at any previously established price. Securities issued with a call provision typically carry a higher yield than similar securities issued without a call feature. There are three primary types of call options (1) European -one-time calls, (2) Bermudan - periodically on a predetermined schedule (quarterly, semi-annual, annual), and (3)American-continuously callable at anytime on or after the call date.There is usually a notice period of at least 5 business days prior to a call date. Callable Bonds/Notes. Securities which contain an imbedded call option giving the issuer the right to redeem the securities prior to maturity at a predetermined price and time. Certificate of Deposit (CD). Bank obligation issued by a financial institution generally offering a fixed rate of return (coupon) for a specified period of time (maturity). Can be as long as 10 years to maturity, but most CDs purchased by public agencies are one year and under. Collateral. Investment securities or other property that a borrower pledges to secure repayment of a loan, secure deposits of public monies, or provide security fora repurchase agreement. Collateralization. Process by which a borrower pledges securities, property, or other deposits for securing the repayment of a loan and/or security. 'Collateralized Mortgage Obligation (CMO). A security that pools together mortgages and separates them into short, medium, and long-term positions (called tranches). Tranches are set up to pay different rates of interest depending upon their maturity. Interest payments are usually paid monthly. In "plain vanilla" CMOs, principal is not paid on a tranche until all shorter tranches have been paid off. This system. provides interest and principal in a more predictable manner.A single pool of mortgages can be carved up into numerous tranches each with its own payment and risk characteristics. Commercial Paper. Short term unsecured promissory note issued by a company or financial institution. Issued at a discount and matures for par or face value. Usually a maximum maturity of 270 days and given a short-term debt rating by one or more NRSROs. Convexity. A measure of a bond's price sensitivity to changing interest rates. A high convexity indicates greater sensitivity of a bond's price to interest rate changes. Corporate Note. A debt instrument issued by a corporation with a maturity of greater than one year and less than ten years. Counterparty. The other party in a two-party financial transaction. "Counterparty risk" refers to the risk that the other party to a transaction will fail in its related obligations. For example, the bank or broker/dealer in a repurchase agreement. Coupon Rate. Annual rate of interest on a debt security, expressed as a percentage of the bond's face value. Current Yield. Annual rate of return on a bond based on its price. Calculated as 3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 (coupon rate/price) but does not accurately reflect a bond's true yield level. Custody. Safekeeping services offered by a bank, financial institution, or trust company, referred to as the "custodian." Service normally includes the holding and reporting of the customer's securities, the collection and disbursement of income, securities settlement, and market values. Dealer. A dealer,as opposed to a broker,acts as a principal in all transactions,buying and selling for his/her own account. Delivery Versus Payment(DVP). Settlement procedure in which securities are delivered versus payment of cash, but only after cash,has been received. Most security transactions, including those through the Fed Securities Wire system and DTC, are done DVP as a protection for both the buyer and seller of securities. Depository Trust Company (DTC). A firm through which members can use a computer to arrange for securities to be delivered to other members without physical delivery of certificates. A member of the Federal Reserve System and owned mostly by the New York Stock Exchange, the Depository Trust Company uses computerized debit and credit entries. Most corporate securities, commercial paper, CDs, and BAs clear through DTC. •Derivatives. (1) Financial instruments whose return profile is linked to, or derived from, the movement of one or more underlying index or security, and may include a leveraging factor, or (2) financial contracts based upon notional amounts whose value is derived from an underlying index or security (interest rates, foreign exchange rates, equities, or commodities). For hedging purposes, common derivatives are options, futures, interest rate swaps, and swaptions. All Collateralized Mortgage Obligations (CMOs)are derivatives. Derivative Security. Financial instrument created from, or whose value depends upon, one or more underlying assets or indexes of asset values. Designated Bond. FFCB's regularly issued, liquid, non-callable securities that generally have a 2- or 3-year original maturity. New issues of Designated Bonds are $1 billion or larger. Re- openings of existing Designated Bond issues are generally a minimum of $100 million. Designated Bonds are offered through a syndicate of two to six dealers.Twice each month the Funding Corporation announces its intention to issue a new Designated Bond, reopen an existing issue, or to not issue or reopen a Designated Bond. Issues under the Designated Bond program constitute the same credit standing as other FFCB issues; they simply add organization and liquidity to the intermediate-and long-term Agency market. Discount Notes. Unsecured general obligations issued by Federal Agencies at a discount. Discount notes mature at par and can range in maturity from overnight to one year. Very large primary•(new issue) and secondary markets exist. Discount Rate. Rate charged by the system of Federal Reserve Banks on overnight loans to member banks. Changes to this rate are administered by the Federal Reserve and closely mirror changes to the "fed funds rate." 4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 Discount Securities. Non-interest-bearing money market instruments that are issued at discount and redeemed at maturity for full face value. Examples include: U.S. Treasury Bills, Federal Agency Discount Notes, Bankers'Acceptances, and Commercial Paper. Discount. The amount by which a bond or other financial instrument sells below its face value. See also "Premium." Diversification. Dividing investment funds among a variety of security types, maturities, industries, and issuers offering potentially independent returns. Dollar Price. A bond's cost expressed as a percentage of its face value. For example, a bond quoted at a dollar price of 95 1/2, would have a principal cost of $955 per$1,000 of face value. Duff& Phelps. One of several NRSROs that provide credit ratings on corporate and bank debt issues. Duration. The weighted average. maturity of a security's or portfolio's cash-flows,where the present values of the cash-flows serve as the weights. The greater the duration of a security/portfolio,the greater its percentage price volatility with respect to changes in interest rates. Used as a measure of risk and a key tool for managing a portfolio versus a benchmark and for hedging risk. There are also different kinds of duration used for different purposes (e.g. MacAuley Duration, Modified Duration). Fannie Mae. See "Federal National Mortgage Association." Fed Money Wire. A computerized communications system that connects the Federal Reserve System with its member banks,certain U.S.Treasury offices, and the Washington D.C. office of the Commodity Credit Corporation.The Fed Money Wire is the book entry system used to transfer cash balances between banks for themselves and for customer accounts. Fed Securities Wire. A computerized communications system that facilitates book entry transfer of securities between banks, brokers and customer accounts, used primarily for settlement of U.S.Treasury and Federal Agency securities. Fed. See "Federal Reserve System." Federal Agency Security. A debt instrument issued by one of the Federal Agencies. Federal Agencies are considered second in credit quality and liquidity only to U.S.Treasuries. Federal Agency. Government sponsored/owned entity created by the U.S. Congress, generally for the purpose of acting as a financial intermediary by borrowing in the marketplace and directing proceeds to specific areas of the economy considered to otherwise have restricted access to credit markets. The largest Federal Agencies are GNMA, FNMA, FHLMC, FHLB, FFCB, SLMA, and TVA. Federal Deposit Insurance Corporation (FDIC). Federal agency that insures deposits at commercial banks, currently to a limit of$250,000 per depositor per bank. 5 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • • Federal Farm Credit Bank(FFCB). One of the large Federal Agencies. A government sponsored enterprise (GSE) system that is a network of cooperatively-owned lending institutions that provides credit services to farmers,agricultural cooperatives and rural utilities.The FFCBs act as financial intermediaries that borrow money in the capital markets and use the proceeds to make loans and provide other assistance to farmers and farm-affiliated businesses. Consists of the consolidated operations of the Banks for Cooperatives, Federal Intermediate Credit Banks, and Federal Land Banks. Frequent issuer of discount notes, agency notes and callable agency securities. FFCB debt is not an obligation of, nor is it guaranteed by the U.S. government, although it is considered to have minimal credit risk due to its importance to the U.S. financial system and agricultural industry.Also, issues notes under its"designated note" program. Federal Funds (Fed Funds). Funds placed in Federal Reserve Banks by depository institutions in excess of current reserve requirements, and frequently loaned'or borrowed on an overnight basis between depository institutions. Federal Funds Rate (Fed Funds Rate). The interest rate charged by a depository institution lending Federal Funds to another depository institution. The Federal Reserve influences this rate by establishing a "target" Fed Funds rate associated with the Fed's management of monetary policy. ;Federal Home Loan Bank System (FHLB). One of the large Federal Agencies. A government sponsored .enterprise (GSE) system, consisting of wholesale banks (currently twelve district • banks) owned by their member banks, which provides correspondent banking services and credit to various financial institutions, financed by the issuance of securities. The principal purpose of the FHLB is to add liquidity to the mortgage markets. Although FHLB does not directly fund mortgages; it provides a stable supply of credit to thrift institutions that make new mortgage loans.FHLB debt is not an obligation of, nor is it guaranteed by the U.S. government, although it is considered to have minimal credit risk due to its importance to the U.S. financial system and housing market. Frequent issuer of discount notes,agency notes and callable agency securities. Also issues notes under its "global note" and "TAP" programs. Federal Home Loan Mortgage Corporation (FHLMC or "Freddie Mac"). One of the large Federal Agencies. A government sponsored public corporation (GSE) that provides stability and assistance to the secondary market for home mortgages by purchasing first mortgages and participation interests financed by the sale of debt and guaranteed mortgage backed securities. FHLMC debt is not an obligation of, nor is it guaranteed by the U.S. government, although it is considered to have minimal credit risk due to its importance to the U.S. financial system and housing market. Frequent issuer of discount notes, agency notes, callable agency securities, and MBS. Also, issues notes under its "reference note" program. Federal National Mortgage Association (FNMA or "Fannie Mae"). One of the large Federal Agencies. A government sponsored public corporation (GSE) that provides liquidity to the residential mortgage market by purchasing mortgage loans from lenders, financed by the issuance of debt securities and MBS (pools of mortgages packaged, together as a security). FNMA debt is not an obligation of, nor is it guaranteed by the U.S. government, although it is considered to have minimal credit risk due to its importance to the U.S. financial system and 6 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 housing market. Frequent issuer of discount notes, agency notes, callable agency securities and MBS.Also, issues notes under its "benchmark note" program. Federal Reserve Bank. One of the 12 distinct banks of the Federal Reserve System. Federal Reserve System (the Fed). The independent central bank system of the United States that establishes and conducts the nation's monetary policy.This is accomplished in three major ways: (1) raising or lowering bank reserve requirements, (2) raising or lowering the target Fed Funds Rate and Discount Rate, and (3) in open market operations by buying and selling government securities.The Federal Reserve System is made up of twelve Federal Reserve District Banks, their branches, and many national and state banks throughout the nation. It is headed by the seven-member Board of Governors known as the "Federal Reserve Board" and headed by its Chairman. Financial Industry Regulatory Authority, Inc. (FINRA). A private corporation that acts as a self-regulatory organization (SRO). FINRA is the successor to the National Association of • Securities Dealers, Inc. (NASD). Though sometimes mistaken for a government agency, it is a non-governmental organization that performs financial regulation of member brokerage firms and exchange markets. The government also has a regulatory arm for investments, the Securities and Exchange Commission (SEC). Fiscal Agent/Paying Agent. A bank or trust company that acts, under a trust agreement with a corporation or municipality, in the capacity of general treasurer. The agent performs such duties as making coupon payments, paying rents,redeeming bonds,and handling taxes relating to the issuance of bonds. Fitch Investors Service, Inc. One of several NRSROs that provide credit ratings on corporate and municipal debt issues. Floating Rate Security (FRN or "floater"). A bond with an interest rate that is adjusted according to changes in an interest rate or index. Differs from variable- rate debt in that the changes to the rate take place immediately when the index changes, rather than on a predetermined schedule.See also "Variable Rate Security." Freddie Mac. See "Federal Home Loan Mortgage Corporation." Ginnie Mae. See "Government National Mortgage Association." Global Notes: Notes designed to qualify for immediate trading in both the domestic U.S.capital market and in foreign markets around the globe. Usually large issues that are sold to investors worldwide and therefore have excellent liquidity. Despite their global sales, global notes sold in the U.S. are typically denominated in U.S. dollars. Government National Mortgage Association (GNMA or "Ginnie Mae"). One of the large Federal Agencies. Government-owned Federal Agency that acquires, packages, and resells mortgages and mortgage purchase commitments in the form of mortgage-backed securities. Largest issuer of mortgage pass-through securities. GNMA debt is guaranteed by the full faith 7 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 and credit of the U.S. government(one of the few agencies that are actually full faith and credit of the U.S. government). Government Securities. An obligation of the U.S. government backed by the full faith and credit of the government. These securities are regarded as the highest quality of investment securities available in the U.S. securities market.See "Treasury Bills, Notes, Bonds, and SLGS." • • • DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1 A2C0 Government Sponsored Enterprise (GSE). Privately owned entity subject to federal regulation and supervision,created by the U.S.Congress to reduce the cost of capital for certain borrowing sectors of the economy such as students, farmers, and homeowners. GSEs carry the implicit backing of the U.S. government, but they are not direct obligations of the U.S. government. For this reason, these securities will offer a yield premium over U.S. Treasuries. Examples of GSEs include:.FHLB, FHLMC, FNMA, and SLMA. Government Sponsored Enterprise Security. A security issued by a Government Sponsored Enterprise. Considered Federal Agency Securities. Index. A compilation of statistical data that tracks changes in the economy or in financial markets. Interest-Only (10) STRIP. A security based solely on the interest payments from the bond. After the principal has been repaid, interest payments stop and the value of the security falls to nothing. Therefore, lOs are considered risky investments. Usually associated with mortgage-backed securities. Internal Controls. An internal control structure ensures that the assets of the entity are protected from loss, theft, or misuse. The internal control structure is designed to provide reasonable assurance that these objectives are met. The concept of reasonable assurance recognizes that 1)the cost of a control should not exceed the benefits likely to be derived and 2) the valuation of costs and benefits requires estimates and judgments by management. Internal controls should address the following points: 1. Control of collusion - Collusion is a situation where two or more employees are working in ' conjunction to defraud their employer. 2. Separation of transaction authority from accounting and record keeping - A separation of duties is achieved by separating the person who authorizes or performs the transaction from the people who record or otherwise account for the transaction. 3. Custodial safekeeping - Securities purchased from any bank or dealer including appropriate collateral (as defined by state law)shall be placed with an independent third party for custodial safekeeping. 4. Avoidance of physical delivery securities- Book-entry securities are much easier to transfer and account for since actual delivery of a document never takes place. Delivered securities must be properly safeguarded against loss or destruction. The potential for fraud and loss increases with physically delivered securities. 5.Clear delegation of authority to subordinate staff members -Subordinate staff members must have a clear understanding of their authority and responsibilities to avoid improper actions. Clear delegation of authority also preserves the internal control structure that is contingent on the various staff positions and their respective responsibilities. 9 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 6. Written confirmation of transactions for investments and wire transfers - Due to the potential for error and improprieties arising from telephone and electronic transactions, all transactions should be supported by written communications and approved by the appropriate person. Written communications may be via fax if on letterhead and if the safekeeping institution has a list of authorized signatures. 7. Development of a wire transfer agreement with the lead bank and third-party custodian - The designated official should ensure that an agreement will be entered into and will address the following points:controls,security provisions,and responsibilities of each party making and receiving wire transfers. Inverse Floater; A floating rate security structured in such a way that it reacts inversely to the direction of interest rates. Considered risky as their value moves in the opposite direction of normal fixed-income investments and whose interest rate can fall to zero. Investment Advisor. A company that provides professional advice managing portfolios, investment recommendations, and/or research in exchange for a management fee. Investment Adviser Act of 1940. Federal legislation that sets the standards by which investment companies, such as mutual funds, are regulated in the areas of advertising, promotion, performance reporting requirements, and securities valuations. Investment Grade. Bonds considered suitable for preservation of invested capital, including bonds rated a minimum of Baa3 by Moody's, BBB-by Standard & Poor's, or BBB- by Fitch. Although "BBB" rated bonds are considered investment grade, most public agencies cannot invest in securities rated below "A." Liquidity. Relative ease of converting an asset into cash without significant loss of value. Also, a relative measure of cash and near-cash items in a portfolio of assets. Additionally, it is a term describing the marketability of a money market security correlating to the narrowness of the spread between the bid and ask prices. Local Government Investment Pool(LGIP). An investment by local governments in which their money is pooled as a method for managing local funds, (e.g., Florida State Board of Administration's Florida Prime Fund). Long-Term Core Investment Program. Funds that are not needed within a one-year period. Market Value. The fair market value of a security or commodity. The price at which a willing buyer and seller would pay for a security. Mark-to-market. Adjusting the value of an asset to its market value, reflecting in the process unrealized gains or losses. Master Repurchase Agreement. A widely accepted standard agreement form published by the Securities Industry and Financial Markets Association (SIFMA) that is used to govern and document Repurchase Agreements and protect the interest of parties in a repo transaction. Maturity Date. Date on which principal payment of a financial obligation is to be paid. 10 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Medium Term Notes (MTN's). Used frequently to refer to corporate notes of medium maturity(5-years and under).Technically, any debt security issued by a corporate or depository institution with a maturity from 1 to 10 years and issued under an MTN shelf registration. Usually issued in smaller issues with varying coupons and maturities and underwritten by a variety of broker/dealers (as opposed to large corporate deals issued and underwritten all at once in large size and with a fixed coupon and maturity). Money Market. The market in which short-term debt instruments (bills, commercial paper, bankers' acceptance, etc.) are issued and traded. Money Market Mutual Fund(MMF). A type of mutual fund that invests solely in money market instruments, such as: U.S. Treasury bills, commercial paper, bankers' acceptances, and repurchase agreements. Money market mutual funds are registered with the SEC under the Investment Company Act of 1940 and are subject to "rule 2a-7" which significantly limits average maturity and credit quality of holdings. MMF's are managed to maintain a stable net asset value (NAV) of $1.00. Many MMFs carry ratings by a NRSRO. Moody's Investors Service. One of several NRSROs that provide credit ratings on corporate and municipal debt issues. Mortgage Backed Securities (MBS). Mortgage-backed securities represent an ownership interest in a pool of mortgage loans made by financial institutions, such as savings and loans, commercial banks, or mortgage companies, to finance the borrower's purchase of a home or other real estate.The majority of MBS are issued and/or guaranteed by GNMA, FNMA, and FHLMC.There are a variety of MBS structures with varying levels of risk and complexity. All MBS have reinvestment risk as actual principal and interest payments are dependent on the payment of the underlying mortgages which can be prepaid by mortgage holders to refinance and lower rates or simply because the underlying property was sold. Mortgage Pass-Through Securities. A pool of residential mortgage loans with the monthly interest and principal distributed to investors on a pro-rata basis.The largest issuer is GNMA. Municipal Note/Bond. A debt instrument issued by a state or local government unit or public agency.The vast majority of municipals are exempt from state and federal income tax,although some non-qualified issues are taxable. Mutual Fund. Portfolio of securities professionally managed by a registered investment company that issues shares to investors. Many different types of mutual funds exist (e.g., bond, equity, and money market funds); all except money market funds operate on a variable net asset value (NAV). Negotiable Certificate of Deposit (Negotiable CD). Large denomination CDs ($100,000 and larger) that are issued in bearer form and can be traded in the secondary market. Net Asset Value. The market value of one share of an investment company, such as a mutual fund. This figure is calculated by totaling a fund's assets including securities, cash, and any accrued earnings, then subtracting the total assets from the fund's liabilities, and dividing 11 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 this total by the number of shares outstanding.This is calculated once a day based on the closing price for each security in the fund's portfolio. (See below.) • [(Total assets)- (Liabilities)]/(Number of shares outstanding) NRSRO. A "Nationally Recognized Statistical Rating Organization" (NRSRO) is a designated rating organization that the SEC has deemed a strong national presence in the U.S. NRSROs provide credit ratings on corporate and bank debt issues. Only ratings of a NRSRO maybe used for the regulatory purposes of rating. Includes Moody's,S&P, Fitch, and Duff& Phelps. Offered Price. See also "Ask Price." Open Market Operations. A Federal Reserve monetary policy tactic entailing the purchase or sale of government securities in the open market by the Federal Reserve System from and to primary dealers in order to influence the money supply,credit conditions, and interest rates. Par Value. The face value, stated value,or maturity value of a security. Physical Delivery. Delivery of readily available underlying assets at contract maturity. Portfolio. Collection of securities and investments held by an investor. Premium. The amount by which a bond or other financial instrument sells above its face value. See also "Discount." Primary Dealer. A designation given to certain government securities dealer by the Federal Reserve Bank of New York. Primary dealers can buy and sell government securities directly with the Fed. Primary dealers also submit daily reports of market activity and security positions held to the Fed and are subject to its informal oversight. Primary dealers are the largest buyers and sellers by volume in the U.S.Treasury securities market. Prime Paper. Commercial paper of high quality. Highest rated paper is A-1+/A-1 by S&P and P- 1 by Moody's. Principal. Face value of a financial instrument on which interest accrues. May be less than par value if some principal has been repaid or retired. For a transaction, principal is par value times price and includes any premium or discount. Prudent Expert Rule. Standard that requires that a fiduciary manage a portfolio with the care, skill, prudence,and diligence, under the circumstances then prevailing, that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims. This statement differs from the "prudent person" rule in that familiarity with such matters suggests a higher standard than simple prudence. Prudent Investor Standard. Standard that requires that when investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to,the general economic conditions and the anticipated needs of the agency,that a prudent person acting in a like capacity and familiarity with those matters would use in the 12 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 conduct of funds of a like character and with like aims,to safeguard the principal and maintain the liquidity needs of the agency. More stringent than the "prudent person" standard as it implies a level of knowledge commensurate with the responsibility at hand. Qualified Public Depository - Per Subsection 280.02(26), F.S., "qualified public depository" means any bank,savings bank, or savings association that: 1. Is organized and exists under the laws of the United States, the laws of this state or any other state or territory of the United States. 2. Has its principal place of business in this state or has a branch office in this state which is authorized under the laws of this state or of the United States to receive deposits in this state. 3. Has deposit insurance under the provision of the Federal Deposit Insurance Act, as amended, 12 U.S.C. ss.1811 et seq. 4. Has procedures and practices for accurate identification, classification, reporting, and collateralization of public deposits. 5. Meets all requirements of Chapter 280, F.S. 6. Has been designated by the Chief Financial Officer as a qualified public depository. Range Note. A type of structured note that accrues interest daily at a set coupon rate that is tied to an index. Most range notes have two coupon levels; a higher accrual rate for the period the index is within a designated range, the lower accrual rate for the period that the index falls outside the designated range. This lower rate may be zero and may result in zero earnings. Rate of Return. Amount of income received from an investment, expressed as a percentage . of the amount invested. Realized Gains (Losses). The difference between the sale price of an investment and its book value.Gains/losses are"realized"when the security is actually sold,as compared to"unrealized" gains/losses which are based on current market value.See "Unrealized Gains (Losses)." Reference Bills: FHLMC's short-term debt program created to supplement its existing discount note program by offering issues from one month through one year, auctioned on a weekly or on an alternating four-week basis (depending upon maturity) offered in sizeable volumes($1 billion and up)on a cycle of regular,standardized issuance. Globally sponsored and distributed, Reference Bill issues are intended to encourage active trading and market-making and facilitate the development of a term repo market. The program was designed to offer predictable supply, pricing transparency, and liquidity, thereby providing alternatives to U.S. Treasury bills. FHLMC's Reference Bills are unsecured general corporate obligations. This program supplements the corporation's existing discount note program. Issues under the Reference program constitute the same credit standing as other FHLMC discount notes; they simply add organization and liquidity to the short-term Agency discount note market. 13 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Reference Notes: FHLMC's intermediate-term debt program with issuances of 2, 3, 5, 10, and 30-year maturities. Initial issuances range from $2 - $6 billion with re- openings ranging$1-$4 billion. The notes are high-quality bullet structures securities that pay interest semiannually. Issues • under the Reference program constitute the same credit standing as other FHLMC notes;they simply add organization and liquidity to the intermediate-and long-term Agency market. Repurchase Agreement (Repo). A short-term investment vehicle where an investor agrees to buy securities from a counterparty and simultaneously agrees to resell the securities back to the counterparty at an agreed upon time and for an agreed upon price.The difference between the purchase price and the sale price represents interest earned on the agreement. In effect, it represents a collateralized loan to the investor, where the securities are the collateral can be DVP, where securities are delivered to the investor's custodial bank, or "tri-party" where the securities are delivered to a third-party intermediary. Any type of security can be used as "collateral," but only some types provide the investor with special bankruptcy protection under the law. Repos should be undertaken only when an appropriate BMA approved master repurchase agreement is in place. Reverse Repurchase Agreement (Reverse Repo). A repo from the point of view of the original seller of securities. Used by dealers to finance their inventory of securities by essentially borrowing at short-term rates. Can also be used to leverage a portfolio and in this sense, can be considered risky if used improperly. Safekeeping. Service offered for a fee, usually by financial institutions, for the holding of securities and other valuables. Safekeeping is a component of custody services. Secondary Market. Markets for the purchase and sale of any previously issued financial instrument. Securities Industry and Financial Markets Association (SIFMA). The bond market trade association representing the largest securities markets in the world. In addition to publishing a Master Repurchase Agreement, widely accepted as the industry standard document for Repurchase Agreements, the SIFMA also recommends bond market closures and early closes due to holidays. Securities Lending. An arrangement between and investor and a custody bank that allows the custody bank to "loan" the investors investment holdings, reinvest the proceeds in permitted investments, and shares any profits with the investor. Should be governed by a securities lending agreement. Can increase the risk of a portfolio in that the investor takes on the default • risk on the reinvestment at the discretion of the custodian. Sinking Fund. A separate accumulation of cash or investments (including earnings on investments) in a fund in accordance with the terms of a trust agreement or indenture, funded by periodic deposits by the issuer(or other entity responsible for debt service),for the purpose of assuring timely availability of moneys for payment of debt service. Usually used in connection with term bonds. 14 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Spread. The difference between the price of a security and similar maturity U.S. Treasury investments, expressed in percentage terms or basis points.A spread can also be the absolute difference in yield between two securities. The securities can be in different markets or within the same securities market between different credits, sectors, or other relevant factors. Standard & Poor's. One of several NRSROs that provide credit ratings on corporate and municipal debt issues. STRIPS (Separate Trading of Registered Interest and Principal of Securities). Acronym applied to U.S.Treasury securities that have had their coupons and principal repayments separated into individual zero-coupon Treasury securities.The same technique and "strips" description can be applied to non-Treasury securities(e.g., FNMA strips). Structured Notes. Notes that have imbedded into their structure options such as step-up coupons or derivative-based returns. Swap. Trading one asset for another. TAP Notes: Federal Agency notes issued under the FHLB TAP program. Launched in 6/99 as a refinement to the FHLB bullet bond auction process. In a break from the FHLB's traditional practice of bringing numerous small issues to market with similar maturities, the TAP Issue Program uses the four most common maturities and reopens them up regularly through a competitive auction.These maturities(2, 3,5,and 10 year)will remain open for the calendar quarter, after which they will be closed and a new series of TAP issues will be opened to replace them. This reduces the number of separate bullet bonds issued but generates enhanced awareness and liquidity in the marketplace through increased issue size and secondary market volume. Tennessee Valley Authority (TVA). One of the large Federal Agencies. A wholly owned corporation of the United States government that was established in 1933 to develop the resources of the Tennessee Valley region in order to strengthen the regional and national economy and the national defense. Power operations are separated from non-power operations. TVA securities represent obligations of TVA, payable solely from TVA's net power proceeds, and are neither obligations of nor guaranteed by the United States. TVA is currently authorized to issue debt up to $30 billion. Under this authorization, TVA may also obtain advances from the U.S.Treasury of up to$150 million. Frequent issuer of discount notes,agency notes, and callable agency securities. Total Return. Investment performance measured over a period of time that includes coupon interest, interest on interest, and both realized and unrealized gains or losses. Total return includes,therefore, any market value appreciation/depreciation on investments held at period end. 15 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Treasuries. Collective term used to describe debt instruments backed by the U.S. government and issued through the U.S. Department of the Treasury. Includes Treasury bills, Treasury notes, and Treasury bonds. Also, a benchmark term used as a basis by which the yields of non-Treasury securities are compared (e.g., "trading at 50 basis points over Treasuries"). Treasury Bills (T-Bills). Short-term direct obligations of-the United States government issued with an original term of one year or less. Treasury bills are sold at a discount from face value and do not pay interest before maturity. The difference between the purchase price of the bill and the maturity value is the interest earned on the bill.Currently,the U.S.Treasury issues 4-week, 13-week, and 26-week T-Bills. Treasury Bonds. Long-term interest-bearing debt securities backed by the U.S.government and issued with maturities of ten years and longer by the U.S. Department of the Treasury. The Treasury stopped issuing Treasury Bonds in August 2001. Treasury Notes. Intermediate interest-bearing debt securities backed by the U.S. government and issued with maturities ranging from one to ten years by the U.S. Department of the Treasury.The Treasury currently issues 2-year, 5-year, and 10-year Treasury Notes. Trustee. A bank designated by an issuer of securities as the custodian of funds and official representative of bondholders. Trustees are appointed to insure compliance with the bond documents and to represent bondholders in enforcing their contract with the issuer. Uniform Net Capital Rule. SEC Rule 15c3-1 that outlines the minimum net capital ratio (ratio of indebtedness to net liquid capital) of member firms and non-member broker/dealers. Unrealized Gains(Losses). The difference between the market value of an investment and its book value. Gains/losses are "realized" when the security is actually sold, as compared to "unrealized" gains/losses which are based on current market value. See also "Realized Gains (Losses)." Variable-Rate Security. A bond that bears interest at a rate that varies over time based on a specified schedule of adjustment(e.g.,daily,weekly, monthly,semi-annually,or annually).See also "Floating Rate Note." • Weighted Average Maturity (or just "Average Maturity"). The average maturity of all securities and investments of a portfolio, determined by multiplying the par or principal value of each security or investment by its maturity (days or years), summing the products, and dividing the sum by the total principal value of the portfolio.A simple measure of risk of a fixed- income portfolio. Weighted Average Maturity to Call. The average maturity of all securities and investments of a portfolio, adjusted to substitute the first call date per security for maturity date for those securities with call provisions. Yield Curve. A graphic depiction of yields on like securities in relation to remaining maturities spread over a time line. The traditional yield curve depicts yields on U.S. Treasuries, although 16 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 yield curves exist for Federal Agencies and various credit quality corporates as well. Yield curves can be positively sloped (normal)where longer-term investments have higher yields, or "inverted" (uncommon)where longer-term investments have lower yields than shorter ones. Yield to Call (YTC). Same as "Yield to Maturity," except the return is measured to the first call date rather than the maturity date. Yield to call can be significantly higher or lower than a security's yield to maturity. Yield to Maturity (YTM). Calculated return on an investment, assuming all cash-flows from the security are reinvested at the same original yield. Can be higher or lower than the coupon rate depending on market rates and whether the security was purchased at a premium or discount. There are different conventions for calculating YTM for various types of securities. Yield. There are numerous methods of yield determination. In this glossary, see also "Current Yield," "Yield Curve," "Yield to Call," and "Yield to Maturity." 17 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 ATTACHMENT A RESOLUTION&COMMISSION AWARD MEMO DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • RESOLUTION NO. 2022-31973 • A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, ACCEPTING THE RECOMMENDATION OF THE CITY MANAGER, PURSUANT TO REQUEST FOR QUALIFICATIONS (RFQ) 2021-264-KB INVESTMENT ADVISORY SERVICES; AUTHORIZING THE ADMINISTRATION TO ENTER INTO NEGOTIATIONS WITH PUBLIC TRUST ADVISORS LLC, AS THE TOP RANKED PROPOSER; FURTHER, IF THE ADMINISTRATION IS NOT SUCCESSFUL IN NEGOTIATING AN AGREEMENT WITH PUBLIC TRUST ADVISORS LLC, AUTHORIZING THE ADMINISTRATION TO ENTER INTO NEGOTIATIONS WITH PFM ASSET MANAGEMENT LLC, AS THE SECOND RANKED PROPOSER; FURTHER, IF THE ADMINISTRATION IS NOT SUCCESSFUL IN NEGOTIATING AN AGREEMENT WITH PFM ASSET MANAGEMENT LLC, AUTHORIZING THE ADMINISTRATION TO ENTER INTO NEGOTIATIONS WITH CHANDLER ASSET MANAGEMENT, INC., AS THE THIRD RANKED PROPOSER; FURTHER AUTHORIZING THE CITY MANAGER AND CITY CLERK TO EXECUTE AN AGREEMENT, UPON CONCLUSION OF SUCCESSFUL NEGOTIATIONS BY THE ADMINISTRATION. WHEREAS, on September 4, 2015 the City of Miami Beach ("City')executed a three (3) year agreement for the investment advisory services with Public Trust Advisors, LLC with an initial expiration date of September 3, 2020; and • WHEREAS, on July 28, 2021, the Mayor and City Commission approved the issuance of • Request for Qualifications (RFQ)2021-264-KB for Investment Advisory Services and the month- to-month extension of the current agreement with Public Trust Advisors, LLC, until a replacement agreement is executed; and WHEREAS, the City received proposals from the following four (4) firms: Public Trust Advisors LLC ("Public Trust"), PFM Asset Management LLC ("PFM"), Chandler Asset Management, Inc. ("Chandler"), and Influctec; and WHEREAS, on November 17, 2021, the Evaluation Committee appointed by the Interim City Manager convened to consider the proposals received; and WHEREAS, the Committee members included Richard Ajami, Budget Officer, Office of Management & Budget; Frank Estevez, Administrator II, Human Resources Department; Vyomie Greene, Assistant Director, Finance Department; Ronald Starkman, Chair, Audit Committee; and Allison Williams, Deputy Finance Director, Finance Department; and WHEREAS, the Committee received an overview of the project, information relative to the City's Cone of Silence Ordinance and the Government Sunshine Law; and WHEREAS, the Committee also received general information on the scope of services, and a copy of each proposal and was further instructed to score and rank each proposal pursuant to the evaluation criteria established in the RFQ; and WHEREAS, the evaluation process resulted in the proposers being ranked by the Evaluation Committee in the following order: DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 1st Public Trust Advisors LLC 2nd PFM Asset Management LLC 3rd Chandler Asset Management, Inc. WHEREAS, after reviewing all the submissions and the Evaluation Committee process, the City Manager agrees with the Evaluation Committee and finds Public Trust Advisors LLC to be the best-qualified firm to provide Investment Advisory Services for the City of Miami Beach. • NOW,THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY COMMISSION OF • THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City Commission hereby accept the recommendation of the City Manager, pursuant to Request For Qualifications (RFQ) 2021- 264-KB Investment Advisory Services; authorize the Administration to enter into negotiations with Public Trust Advisors LLC, as the top ranked proposer; further, if the administration is not successful in negotiating an agreement with Public Trust Advisors LLC, authorize the Administration to enter into negotiations with PFM Asset Management LLC, as the second ranked proposer; further, if the Administration is not successful in negotiating an agreement with PFM Asset Management LLC, authorize the Administration to enter into negotiations with Chandler Asset Management, Inc., as the third ranked proposer; further authorize the City Manager and City Clerk to execute an agreement, upon conclusion of successful negotiations by the Administration. PASSED AND ADOPTED this (° day of 7Gnciai- 2022. ATTEST: 12-21----____ RAFA L E. G NADO, CITY CLERK DAN GELBER, MAYOR JAN 2 5 2022 _ ;, •INC05POR TED %, as III l•^.•. ..::�.- APPROVED AS TO FORM&LANGUAGE &FOR EXECUTION (---YO------ I--(0 --ZZ City Attomeysi Date DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 , Cl -Resolutions G MIAMI BEACH COMMISSION MEMORANDUM TO: Honorable Mayor and Members of the City Commission FROM: Aline T. Hudak, City Manager DATE: January 20,2022 SUBJECT:A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, ACCEPTING THE RECOMMENDATION OF THE CITY MANAGER, PURSUANT TO R='QUEST FOR QUALIFICATIONS (RFQ) 2021-264-KB INVESTMENT ADVISORY SERVICES; AUTHORIZING THE ADMINISTRATION TO ENTER INTO NEGOTIATIONS WITH, PUBLIC TRUST ADVISORS LLC, AS THE TOP-RANKED PROPOSER; FURTHER, IF THE ADMINISTRATION IS NOT SUCCESSFUL IN NEGOTIATING AN AGREEMENT WITH PUBLIC TRUST ADVISORS LLC,AUTHORIZING THE ADMINISTRATION TO ENTER INTO NEGOTIATIONS WITH PFM ASSET MANAGEMENT LLC, AS THE SECOND-RANKED PROPOSER; FURTHER, IF THE ADMINISTRATION IS NOT SUCCESSFUL IN NEGOTIATING AN AGREEMENT WITH PFM ASSET MANAGEMENT LLC,AUTHORIZING THE ADMINISTRATION TO ENTER INTO NEGOTIATIONS WITH CHANDLER ASSET MANAGEMENT, INC., AS THE THIRD-RANKED PROPOSER; FURTHER AUTHORIZING THE CITY MANAGER AND CITY CLERK TO EXECUTE AN AGREEMENT, UPON CONCLUSION OF SUCCESSFUL NEGOTIATIONS BY THE ADMINISTRATION. RECOMMENDATION It is recommended that the Mayor and City Commission approve the Resolution authorizing the Administration to negotiate with Public Trust Advisors LLC, as the top-ranked proposer, for investment advisory services. If the Administration is not successful in negotiating an agreement with the first-ranked proposer, the Resolution requests authorization for the Administration to negotiate with PFM Asset Management LLC, as the second-ranked proposer. If the Administration is not successful in negotiating an agreement with the second-ranked proposer, the Resolution requests authorization for the Administration to negotiate with Chandler Asset Management, Inc., as the-third ranked proposer. The Resolution also authorizes the City Manager and City Clerk to execute an Agreement upon conclusion of successful negotiations by the Administration and the City Attorney's Office. BACKGROUND/HISTORY The Finance Department requires an advisor to provide non-discretionary investment services. Non-discretionary investment services is an arrangement where the selected firm will make recommendations on investments but does not have authority to complete transactions on the Page 234 of 1313 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • City's behalf. Based on the recommendations of the selected firm,the City will ultimately decide and complete transactions for the selected investments. • The City expects its investment advisor to be highly experienced with non-discretionary funds a leader and innovator in the management of investments, and able to provide comprehensive investment advisory services. The firm selected as the investment advisor and its affiliates will be restricted from selling to the City, or buying from the City, any securities to or from that firm's own inventory or account. The investment advisor will also be restricted from placing into the City's portfolio any securities for which it,or an affiliate,is the issuer. Investment advisors will not provide custodial services or security safekeeping. All City investments, except for swap agreements must be held in an independent custodial account. On September 4, 2015, the City of Miami Beach ("City") executed a three (3) year agreement for the investment advisory services with Public Trust Advisors, LLC. with an initial expiration date of September 3,2020. On July 29,2020,the Commission authorized the extension of the agreement for an additional one-year period to reduce its operating costs due to the financial impact that resulted from COV I D 19. During the one (1) year extension, the Finance Department reassessed the market and determined it was in the best interest of the City to seek to establish a replacement agreement for non-discretionary investment services at this time. On July 28, 2021 the City Commission authorized the month-to-month extension of the current agreement with Public Trust Advisors, LLC, until a replacement agreement is executed. Through this RFQ,the City has requested proposals from firms qualified to provide the City with non-discretionary investment advisory services to make recommendations for the City's investments and direct the City's investments. The successful firm would recommend the investment of excess funds in accordance with the City's investment objectives as outlined in the City of Miami Beach's Investment Policy. The key objectives of the City's investment policy are safety of capital, sufficient liquidity.to meet requirements and attaining market—average rates of return. Excess funds are defined as funds not required to meeting short term expenditures of the City. ANALYSIS On July 28, 2021, the Mayor and City Commission approved the issuance of Request for Qualifications (RFQ) 2021-264-KB for Investment Advisory Services. RFQ responses were due and received on September 22,2021. The City received proposals from the following four (4)firms: Public Trust Advisors LLC ("Public Trust"), PFM Asset Management LLC ("PFM"), Chandler Asset Management, Inc.("Chandler),and Influctec. On October 22, 2021, Influctec notified the City that it would like to withdraw its proposal. Therefore,the proposal submitted by Influctec was withdrawn from further consideration. On November 17, 2021, the Evaluation Committee appointed by the Interim City Manager convened to consider the proposals received. The Committee was comprised of: Richard Ajami, Budget Officer, Office of Management & Budget; Frank Estevez, Administrator II, Human Resources Department; Vyomie Greene, Assistant Director, Finance Department; Ronald Starkman, Chair, Audit Committee; and Allison Williams, Deputy Finance Director, Finance Department The Committee was provided an overview of the project, information relative to the City's Cone of Silence Ordinance and the Govemment Sunshine Law. The Committee was also provided with general information on the scope of services and a copy of each proposal. The Committee was instructed to score and rank each proposal pursuant to the Page 235 of 1313 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 evaluation criteria established in the RFQ. • The evaluation process resulted in the proposers being ranked by the Evaluation Committee in the following order(See Attachment A): • 1st ranked—Public Trust Advisors LLC 2nd ranked—PFM Asset Management LLC 3rd ranked—Chandler Asset Management, Inc. Below is a brief summary of each proposing firm based on the information in each firm's proposal. Public Trust Advisors LLC Public Trust was founded on the principles of developing and maintaining strong relationships resulting in client needs focused communication and a holistic approach to the treasury and investment management function. For more than two decades, Public Trust professionals have provided investment solutions for public sector clients. These individuals have a long history of implementing truly customized investment solutions for clients who, like the City, are seeking to maximize the investment income and return of portfolios .while adhering to the primary investment objectives of safety and liquidity. While other firms continue to diversify resources away from public sector investment programs due to the prolonged low interest rate environment, Public Trust is fully committed to this sector and 100% of firm resources are dedicated exclusively to the management and investment advisory services for public funds exclusively. As of June 30, 2021, Public Trust manages $51.4 billion in assets for 76 public fund and governmental entities with more than 237 individual portfolios,all of which are domestic fixed income public funds. As Public Trusts public sector presence continues to grow, it has added significant resources to continually support clients' needs. Public Trust's goal is to ensure that it continues strengthening client relationships through consistent communication and unrivaled service. This includes additional portfolio management and credit professionals at headquarters in Denver, and advisory and analytical support in its Orlando, Florida office. The City's investment advisory relationship would continue to be supported by seven Florida-based investment professionals located in the Orlando office and by more than 25 Denver based professionals,dedicated to the success of the City's investment program. Public Trust has been the City's investment advisor since 2015, and the City has been satisfied with the services provided to date. PFM Asset Management LLC. PFM is the marketing name for a group of affiliated,companies providing a range of services.All services are provided through separate agreements with each company. This material is for general information purposes only and is not intended to provide specific advice or a specific recommendation. Investment advisory services are provided by PFM Asset Management LLC which is registered with the Securities and Exchange Commission ("SEC") under the Investment Advisers Act of 1940. Financial advisory services are provided by PFM Financial Advisors LLC, a registered Page 236 of 1313 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 municipal advisor with the SEC and the Municipal Securities Rulemaking Board ("MSRB") under the Dodd-Frank Act of 2010. Swap advisory services are provided by PFM Swap Advisors LLC which is registered as a municipal advisor with both the MSRB and SEC under the Dodd-Frank Act of 2010, and as a commodity trading advisor with the Commodity Futures Trading Commission.Additional applicable regulatory information is available upon request. Consulting services are provided through PFM Group Consulting LLC. Institutional purchasing card services are provided through PFM Financial Services LLC. PFM's financial modeling platform for strategic forecasting is provided through PFM Solutions LLC. A web-based platform for municipal bond information is provided through Munite LLC. For more than 40 years, PFM professionals have helped governmental clients similar to the City and other institutional investors with the management and advisement of fixed-income portfolios. Nationally, PFM manages or advises on $145.1 billion in total fixed income assets including $107.2 billion in discretionary assets under management ("AUM") and $37.9 billion in non- discretionary assets under advisement (°AUA").1 By leveraging fixed-income dedicated resources and Florida expertise, we believe the City can broaden its investment program to safely increase investment earnings. Chandler Asset Management, Inc. Chandler is an SEC-registered investment adviser founded on the tenets of public agency investing. Chandler has provided comprehensive investment solutions for local governments across the nation just like the City, who are guided by the objectives of safety, liquidity, and yield/return, for over thirty years. Founded by investment officers for public agencies, Chandler provides access to advice and investment manager analysis while bringing clients a personalized and local perspective. As of June 30, 2021, Chandler manages$23.6 billion in firm-wide assets, including over$8 billion in assets for 73 cities. Since 1988, Chandler has assisted local governments in fulfilling fiduciary duty to constituents by providing high quality fixed income portfolios in a prudent investment framework. Chandler utilizes investment securities and strategies that conform to the City's investment policy, applicable federal laws, and Florida Statutes regarding qualified investments for public entities. Chandler focus is on separately managed accounts. Chandler does not manage local government investment pools, therefore dedicating 100% of its resources to managing individual clients'portfolios and providing customization, transparency, and flexibility through the ownership of individually owned securities. Chandler firm assets under management reflect investment strategies for portfolios similar to the services requested in the RFP and do not include assets in advisory-only accounts,local government investment pools,and brokered CDs products that some firms include in assets under management. SUPPORTING SURVEY DATA Not Applicable. FINANCIAL INFORMATION The costs of the related services are not a budgeted expense. Investment advisory service fees are currently netted against investment interest revenue. Page 237 of 1313 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 CONCLUSION After reviewing all of the submissions and the Evaluation Committee process, I concur with the Evaluation Committee and find Public Trust Advisors LLC the best-qualified firm to provide Investment Advisory Services for the City of Miami Beach. Public Trust has vast experience in investment advisory services with government entities such as City of Hollywood, City of Tampa, City of West Palm Beach, and City of Daytona Beach.As the City's current investment advisor, Public Trust has provided reliable service that meets the City's investment policy. PFM and Chandler are also well-qualified firms that should be considered in the event that negotiations with Public Trust are unsuccessful. For the reasons stated herein, I recommend that the Mayor and City Commission approve the Resolution authorizing the Administration to enter into negotiations with Public Trust Advisors LLC, as the top-ranked proposer; and, if the Administration is not successful in negotiating an agreement with Public Trust Advisors LLC, authorizing the Administration to enter into negotiations with PFM Asset Management LLC, as the second-ranked proposer; and, if the Administration is not successful in negotiating an agreement with PFM Asset Management LLC,authorizing the Administration to enter into negotiations with Chandler Asset Management, Inc.,as the third-ranked proposer;further authorizing the City Manager and City Clerk to execute an agreement, upon conclusion of successful negotiations by the Administration. Applicable Area Not Applicable • Is this a"Residents Right Doe*this item utilize G.O. to Know" item,pursuant to Bond Funds? City Code Section 2-14? No No Legislative Tracking Finance/Procurement ATTACHMENTS: Description o Attachment A • Resolution • Page 238 of 1313 DocuSign Envelope ID:eA09c-AF-49o7@4As3CmB1A22 Boum .._ } "" . . \N • .§�6® ■ f |0j0 . &gismo „- pas • , g 1.0. [ass ■__ „• - |as ■ • i $oeo iaza __ ..- Cr) |■;a ; o ■ ' 2 1.00 .| 0 • hasa 122E � . \ - � ` � | 3 • 7 ! \I k® g$ ] ƒ 3 o _ `M fk|} kt dli . d)) - ! g 2!» ��)`2 / k n, DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 ATTACHMENT B ADDENDUM AND RFQ SOLICITATION DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 M I AM I B E, IC H PROCUREMENT DEPARTMENT 1755 Meridian Avenue,3"Floor Miami Beach,Florida 33139 www.miamibeachfl.gov ADDENDUM NO. 1 REQUEST FOR QUALIFICATIONS(RFQ)2021-264-KB INVESTMENT ADVISORY SERVICES September 13,2021 This Addendum to the above-referenced RFQ is issued in response to questions from prospective proposers,or other clarifications and revisions issued by the City.The RFQ is amended in the following particulars only(deletions are shown by strikethrough and additions are underlined). I. ATTACHMENTS: Exhibit A: City of Miami Beach Investment Policy II. RESPONSES TO QUESTIONS RECEIVED: 01:Would the City please disclose the fees paid to its current investment adviser for these services? Al: The purpose of the RFQ is to select the best qualified (as determined by the City)firm for the requested services.Responses pursuant to the RFQ are not to include scope nor cost.Rather,as required per the RFQ, proposers are to submit their qualifications and approach and methodology as indicated in Section 0300.Refer to revised section 0300 attached. After selection the City and the selected firm will negotiate scope,terms,and cost. Q2:Would the City please provide its current CUSIP-level portfolio holdings? A2:Refer to City of Miami Beach Comprehensive Annual Financial Report FY2020: CAFR-Combined-5-27-2021-Final.pdf(miamibeachfl.gov) Starting on page 51 Note 3:Deposits and Investments Q3:Can the City please disclose the$AUM size of the portfolio to be managed? A3: Refer to City of Miami Beach Comprehensive Annual Financial Report FY2020: CAFR-Combined-5-27-2021-Final.pdf(miamibeachfl.gov) Starting on page 51 Note 3:Deposits and Investments Q4:Who is the City's current depository bank? A4:The City's current depository bank is SunTrust now Twist. However, pursuant to Request for Qualifications(RFQ) 2021-090-KB For Various Banking Services the City Manager will recommend to the Mayor and City Commission at its September 17, 2021 meeting, that the Commission approve the resolution authorizing the Administration to enter into negotiations with JP Morgan Chase Bank, N.A., as the top ranked proposer;and, if the Administration is not successful in negotiating an agreement with JP Morgan Chase Bank, N.A., authorizing the Administration to enter into negotiations with Truist Bank, as the second ranked proposer; and, if the Administration is not successful in negotiating an agreement with Truist Bank, authorizing the Administration to enter into negotiations with Wells Fargo Bank, N.A., as the third ranked proposer. The 1 ADDENDUM NO.1 REQUEST FOR QUALIFICATIONS(RFQ)2021-264-KB INVESTMENT ADVISORY SERVICES DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 n PROCUREMENT DEPARTMENT 1755 Meridian Avenue,3ro Floor Miami Beach,Florida 33139 www.miamibeachfl.gov Resolution also authorizes the City Manager and City Clerk to execute an agreement, upon conclusion of successful negotiations by the Administration. Q5:Who is the City's custodian bank? A5:Fiduciary Trust International(FTI)and Fifth Third Bank. Q6:Could the City please provide its most recent monthly and quarterly reports for its portfolios? A6:The sample reports will be provided to the successful proposer during negotiations. Q7: Could the City provide the amount of its bond proceeds and the breakdown of the bond proceeds by type (project funds,debt service reserve funds,debt service funds,etc.)? A7: Refer to City of Miami Beach Comprehensive Annual Financial Report FY2020: CAFR-Combined-5-27-2021-Final.pdf(miamibeachfl.qov) page 73 Note 10 which disclose bond type and original issued(usually original and bond proceeds are the same). page 29 and page 33 for debt service reverse(restricted cash for capital or bond covenant) Q8:Could the City please provide its most recent investment policy? A8:Refer to Exhibit A,City of Miami Beach Investment Policy. Q9:Who currently prepares the City's arbitrage calculations and reports? A9:Hilltop Securities Asset Management. Q10:How often does the City require that arbitrage calculations be prepared?Annually?Every 5th year and final maturity? A10:Annually. Q11:How large is the city's portfolio? A3:Refer to City of Miami Beach Comprehensive Annual Financial Report FY2020: CAFR-Combined-5-27-2021-Final.pdf(miamibeachfl.qov) Starting on page 51 Note 3: Deposits and Investments Q12:Can Public Trust Advisors re-bid for the advisory role? Al2:Yes. Any questions regarding this Addendum should be submitted in writing to the Procurement Department to the attention of the 2 ADDENDUM NO.1 I REQUEST FOR QUALIFICATIONS(RFQ)2021-264-KB INVESTMENT ADVISORY SERVICES DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 MPROCUREMENT DEPARTMENT I A NI I B E C H 1755 Meridian Avenue,3rd Floor Miami Beach,Florida 33139 www.miamibeachfl.gov individual named below,with a copy to the City Clerk's Office at RafaelGranado@miamibeachfl.gov Contact: Telephone: Email: Kristy Bada 305-673-7000 ext.7490 kristybada@miamibeachfl.gov Proposers are reminded to acknowledge receipt of this addendum as part of your RFQ submission. SiletbiL__ThAleis curement Director 3 ADDENDUM NO.1 REQUEST FOR QUALIFICATIONS(RFQ)2021-264-KB INVESTMENT ADVISORY SERVICES DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 n n I PROCUREMENT DEPARTMENT 1755 Meridian Avenue,3rd Floor Miami Beach,Florida 33139 www.miamibeachfl.gov Exhibit A: City of Miami Beach Investment Policy I 4 ADDENDUM NO.1 REQUEST FOR QUALIFICATIONS(RFQ)2021-264-KB INVESTMENT ADVISORY SERVICES DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • CITY OF MIAMI BEACH INVESTMENT POLICY AND PROCEDURE• . it ttoi r 34 s��: • / ` NCO10 o IRATED +fit • s Approved and Amended as of December 12, 2018 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Table of Contents I. Background 3 II. General Overview 3 III. Cash Management 3 IV. Scope 3 V. Bond Funds 4 VI. Objectives 4 Safety of Capita! • Liquidity Return on Investment VII. Prudence and Ethical Standards 5 VIII. Authority and Responsibility 6 IX. Maturity and Liquidity Requirements 6 X. Suitable and Authorized Investments 7 Portfolio Composition and Diversification • XI. Derivatives 18 XII. Prohibited Investments 18 XIII. Authorized Investment Institutions and Dealers 19 • Qualified Financial Institutions and Securities Dealers • Selection Criteria XIV. Third-Party Custodial Agreements 20 Delivery vs. Payment XV. Treasury Management Service Master Agreement 21 XVI. Bid Requirements 21 XVII. Internal Controls 22 XVIII. Continuing Education 23 XIX. Reporting 23 Marking-to-Market XX. Securities 23 XXI. Sale of Securities 24 XXII. Performance Measurements ...24 XXIII. Investment Committee . .25 XXIV. Exemptions 25 XXV. Amendments 25 XXVI. History of Amendments 25 Appendices: A. Section 218.415, Florida Statutes B. GFOA Recommended Practices C. Investment Firm Certification Form D. Master Repurchase Agreement E. Investment Pool/Fund Questionnaire F. Glossary of Cash and Investment Management Terms 2 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • I. BACKGROUND The Florida Legislature passed CS/SB 2090 (CS/HB 1795) on May 4, 1995. Among other provisions of this legislation each local government entities required to create, adopt and maintain comprehensive investment policies, incorporating fourteen required elements. The City has operated under investment guidelines adopted in 1985 and subsequent Ordinance No. 87-2588 and 92-2793 which authorized additional investment alternatives for the City. Due to the adoption of Chapter 218.415 of the Florida Statue, which governs investment policies for local governments, the Mayor and City Commission adopted Resolution No. 95-21726 on September 27, 1995. The City Code Section 18A-1 (reflecting the City's prior adopted investment policies) was repealed. The City's Investment Policy and Procedure has been amended accordingly. II. GENERAL OVERVIEW The City of Miami Beach has established policies relating to the investment of excess funds. Excess funds are defined as funds not required to meet short term expenditures of the City. Excess funds are placed in two general categories of investments. The first category is "cash management investments." Cash management investments are defined as investments whose terms are less than one year. Those funds placed in cash management investments include all daily operating funds, debt service funds and various deposits. The second category is "long term city investments." Long term city investments are investments whose terms are more than one year. III. CASH MANAGEMENT Short term expenditures are defined as all daily operating expenditures excluding payroll and debt service which are invested based on their payment cycle. For short term expenditures, the City maintains a continuous investment program, a Municipal NOW account, collateralized by full faith and credit instruments of the U.S. Government and its Agencies, held by the State of Florida, with the City designated as collateral beneficiary. The City complies with the State of Florida "Public Deposits Law" Chapter 280 Florida Statutes. Chapter 280 insures the City against investment principal loss on certificates of deposits and demand deposits in excess of $250,000 per institution. FDIC insurance covers demand deposits up to $250,000 per institution. The City will utilize only financial institutions qualified under Chapter 280, a listing of which it.received by the City and reviewed on a quarterly basis. The City also complies with Chapter 280 by filing all required reports annually with the State. IV. SCOPE This Investment Policy ("Policy") applies to all transactions involving the financial assets held or controlled by the City of Miami Beach ("City")and its blended component units, not otherwise classified as restricted assets requiring separate investing,in accordance with the requirements of Section 218.415, Florida Statutes. • This Policy shall not apply to discrete component units and pension funds,including those funds under chapters 175 and 185, or funds related to the issuance of debt where there are other 3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 existing policies or indentures in effect for such funds or assets held by third parties(custodians or money managers)under Bond Trust Indenture Agreements.Each pension system has elected or appointed members to its pension Board of Trustees who exercise oversight over money managers engaged to manage pension fund investments in accordance with policies and guidelines established by each pension system. The Boards,therefore,have oversight authority over investments for pension systems and the City does not actively participate in this process. Cash and investment balances as defined in this Section are entirely known as "Available Funds." V. BOND FUNDS Notwithstanding anything to the contrary contained in the bond documents or these investment guidelines the provisions pertaining to investment of monies under all ordinances, resolutions,trust indentures and agreements adopted or entered into by the City in connection with bonds issued by the City or other dept incurred by the City will control and supersede the provisions herein contained with respect to the investment of such monies. VI. OBJECTIVES . The primary objectives, in priority order, of investment activities shall be safety of capital, liquidity of funds and then return on investment. Safety of Capital Safety of capital is the primary objective of the investment program. Accordingly,the overall investment portfolio shall be managed to ensure capital (principal) losses are avoided by mitigating credit risk and interest rate risk. • Credit Risk Credit risk is the risk of loss due to the failure of the security issuer or supporter.Credit risk is mitigated by: • Limiting investments to the safest types of securities. • Pre-qualifying financial institutions,broker/dealers,intermediaries,and advisors with which the'City will do business. • Diversifying the investment portfolio to minimize potential losses on individual securities. • Monitoring investments to anticipate and respond appropriately to changing market conditions. Interest Rate Risk Interest rate risk is the risk that the market value of securities in the portfolio will fall due to changes in general interest rates. Interest rate risk may be mitigated by: • Structuring portfolio maturities to match cashflow requirements for ongoing operations,thereby avoiding the need to sell securities on the open market prior to maturity. 4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • Investing operating funds primarily in shorter-term securities. • • Liquidity The investment portfolio shall remain sufficiently liquid to meet all operating, payroll, and capital requirements that may be reasonably anticipated. The portfolio should always encompass the ability for quick conversion to cash without loss of principal to meet cashflow requirements. Return on Investment The investment portfolio shall be designed with the objective of attaining a market rate of return throughout budgetary and economic cycles,considering the investment risk constraints and liquidity needs. Return on investment is of least importance compared to the safety and liquidity objectives described above. However, return is attempted through active management where the adviser utilizes a total return strategy (which includes both realized and unrealized gains and losses in the portfolio).This total return strategy seeks to increase the value of the portfolio through reinvestment of income and capital gains. The core of investments is limited to relatively low risk securities in anticipation of earning a fair return relative to the risk being assumed. Despite this, a portfolio manager may trade to recognize a loss from time to time to achieve a perceived relative value based on its potential to enhance the total return of the portfolio. VII. PRUDENCE AND ETHICAL STANDARDS Investments shall be made with judgment and care,under circumstances then prevailing,which persons of prudence, discretion, and intelligence exercise in the management of their own affairs,not for speculation,but for investment,considering the safety of capital,liquidity needs, and the expected income to be derived from the investment. Officers and employees involved in the investment process shall refrain from personal business activity that could conflict with the State Statutes and other laws, proper execution and management of the investment program, or that could impair their ability to make impartial decisions. Employees and investment officials shall disclose any material interests in financial institutions with which they conduct business. They shall further disclose any personal financial/investment positions that could be related to the performance of the investment portfolio. Employees and officers shall refrain from undertaking personal investment transactions with the same individual with whom business is conducted on behalf of the City. • While the standard of prudence to be used by the City's staff is the Prudent Person standard, any person or firm hired or retained to invest, monitor, or advise concerning these assets shall be held to the higher standard of"Prudent Expert." The standard shall be that in investing and reinvesting moneys and in acquiring, retaining, managing, and disposing of investments of these funds, the contractor shall exercise: the judgment, care, skill, prudence, and diligence under the circumstances then prevailing, which persons of prudence, discretion, and intelligence, acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of like character and with like aims by diversifying the investments of the funds, so as to minimize the risk, considering the probable income as well as the probable safety of 5 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • their capital. VIII. AUTHORITY AND RESPONSIBILITY The Chief Financial Officer (CFO) is designated as the investment officer of the City and is responsible for the oversight of the management of the investment portfolio and to establish and maintain internal controls over the investment process consistent with this Policy, under the direction of the City Manager. • The CFO has designated the Deputy Finance Director and Treasury Manager as the individual responsible for managing the City's investments. The Investment Advisor discusses investments with upcoming maturities with the CFO or designee if there is a question as to new maturity target dates or type of investment vehicle to be used. Based on these discussions,the Investment Advisor executes the transaction and completes an "Investment Transaction Report" for each investment transaction. Funds related to each investment are transferred according to authorized funds transfer procedures and limits established under the provisions of the City's contract with its main depository bank. In accordance with Resolution No. 2012-27816, the City is required to have an investment advisor with regards to the management of its investment program. Investment advisors shall be registered with the Securities Exchange Commission under the Investment Advisors Act of 1940. Advisors shall be selected using the City's authorized purchasing procedures for selection of professional services and shall be subject to the provisions of this Investment Policy. Under no circumstance shall the advisor take custody of any City funds or securities. The City maintains employee dishonesty insurance and bonding for all employees and officials with signatory authority. • • IX. MATURITY AND.LIQUIDITY REQUIREMENTS Each year a cash flow analysis will be completed to determine the acceptable allocation and balances for each of the following funds.The Deputy Finance Director or Treasury Manager will be responsible for the cash flow analysis,which will be presented to the CFO for review. Operating Funds To the extent possible, an attempt will be made to match investment maturities with known cash needs and anticipated cash flow requirements. Individual investments of current operating funds shall have maturities of no longer than twenty-four(24) months ("Short-Term Portfolio"). Core Funds Investments of reserves, capital funds, and other non-operating funds ("Long- Term Portfolio")shall have a term appropriate to the need for funds, but in no event shall the maturity of any individual security exceed seven (7) years and the average duration of the portfolio may not exceed three (3)years. 6 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • X. SUITABLE AND AUTHORIZED INVESTMENTS • Investments should be made subject to,the cash flow needs and such cash flows are subject to revisions as market conditions and the City's needs change. However,when the invested funds are needed in whole or in part for the purpose originally intended or for more optimal investments,the CFO or designee may sell the investment at the then-prevailing market price • and place the proceeds into the proper account at the City's custodian. The table on the following page summarize the investment instrument parameters and allocation limits on security types, issuers, and maturities, as established by the City. For complying with allocation limits,the term "Available Funds"is defined as Section I of this Policy and not including balances invested in the overnight sweep investment. The CFO or designee shall have the option to further restrict investment percentages from time to time based on market conditions, risk and diversification investment strategies. The percentage allocation requirements for investment types and issuers are calculated based on the market value of each investment at the time of purchase. Investments not listed in this Policy are prohibited. [ Remainder of the page left blank intentionally] • • • DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 Summary of Composition and Diversification Security Type Minimum Maturity Maximum Maximum Rating Limits Allocation Issuer Limit Requirement Limit A Florida PRIME Fund AAAm N/A 25% N/A B United States Government Securities N/A 7 Years 100% N/A C United States Government Agencies(full N/A 7 Years 50% 25% faith and credit of the United States D Federal Instrumentalities(United States N/A 7 Years 80% 40% Government Sponsored Enterprises ("GSE") which are non-full faith and credit).* E Mortgage-Backed Securities (MBS)* N/A 5 Years 15% 15% F Interest Bearing Time Certificates of Deposit N/A 3 Years 25% 15% or G Repurchase Agreements N/A 90 Days 25% 25% I-1 Commercial Paper P-1/A-1 270 Days 25% 5% I Corporate Notes AA rating 5 Years 40% 5% category by any two NRSROs*** J Asset-Backed Securities(ABS)** AA rating 5 Years 15% 5% category by any two NRSROs*** K Bankers'Acceptances P-1/A-1 180 Days 20% 5% L State and/or Local Government Taxable A rating 5 Years 20% 10% and/or category by two Tax-Exempt Debt NRSROs*** M Money Market Mutual Funds AAAm N/A 100% 50% N State of Israel Bonds** A rating 3 years 5%** N/A category by S&P or another NRSROs*** O Intergovernmental Investment Pool AAAm N/A 100% 50% P Florida League of Cities, Inc. Mutual Funds N/A N/A 25% 10% * The combined total of available funds invested in Federal Instrumentalities and Mortgage Backed Securities cannot be more than 80%. ** 5%of operating funds. Bond proceeds not permitted. *** National Recognized Statistical Rating Organization (NRSRO). • • . 8 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PORTFOLIO COMPOSITION AND DIVERSIFICATION Diversity of investment types is highly desirable. To promote diversity,no security or individual cusip shall exceed 5%of the City funds.Such diversity is necessary in cases where securities are traded frequently and not held to maturity.and where volatile securities are traded. A. The Florida PRIME Fund. 1. Investment Authorization Invest in the Florida PRIME Fund. 2. Portfolio Composition A maximum of 25%of Available Funds may invested in the Florida PRIME Fund. 3. Rating Requirements The money market funds shall be rated "AAAm"by Standard &Poor's or the equivalent by another Nationally Recognized Statistical Ratings Organization (N RSRO). 4. Due Diligence Requirements A thorough review of any money market fund is required prior to investing, and on a continual basis. The questionnaire provided in Appendix E must be completed prior to investing. B. United States Government Securities 1. Purchase Authorization Invest in negotiable direct obligations, or obligations the principal and interest of which are unconditionally guaranteed by the United States Government. Such securities will include,but not be limited to the following: Cash Management Bills Treasury Securities — State and Local Government Series("SLGS")Treasury Bills Treasury Notes Treasury Bonds Treasury Strips 2. Portfolio Composition A maximum of 100%of Available Funds may be invested in the United States Government Securities. • 9 • DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 3. Maturity Limitations • The maximum length to maturity of any direct investment in the United States Government Securities is seven (7)years from the date of purchase. C. United States Government Agencies (full faith and credit of the United States Government) 1. Purchase Authorization Invest in bonds, mortgage instruments, debentures or notes which may be subject to call,issued or guaranteed as to principal and interest by the United States Government Agencies, provided such obligations are backed by the full faith and credit of the United States Government. Such securities will • include,but not be limited to the following: Government National Mortgage Association (GNMA) GNMA guaranteed mortgage-backed bonds • GNMA guaranteed pass-through obligations' United States Export—Import Bank Direct obligations or fully guaranteed certificates of beneficial ownership Farmer Home Administration Certificates of beneficial ownership Federal Financing Bank Discount notes, notes and bonds Federal Housing Administration Debentures General Services Administration United States Maritime Administration Guaranteed Title XI Financing New Communities Debentures United States Government guaranteed debentures United States Public Housing Notes and Bonds United States Government guaranteed public housing notes and bonds United States Department of Housing and Urban Development Project notes and local authority bonds 2. Portfolio Composition • A maximum of 50%of Available Funds may be invested in United States Government Agencies. 3. Limits on Individual Issuers A maximum of 25% of available funds may be invested in individual United States Government Agencies. • 10 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • 4. Maturity Limitations The maximum length to maturity for an investment in any United States Government Agency security is seven (7)years from the date of purchase. D. Federal Instrumentalities (United States Government Sponsored Enterprises ("GSE")which are non-full faith and credit). 1. Purchase Authorization • Invest in bonds, mortgage instruments debentures or notes which may be subject to call, issued or guaranteed as to principal and interest by Federal Instrumentalities (United States Government Sponsored Enterprises),which are non-full faith and credit agencies including the following: Federal Farm Credit Bank(FFCB) Federal Home Loan Banks (FHLB) • Federal National Mortgage Association (FNMA) Federal Home Loan Mortgage Corporation (Freddie-Mac) including Federal-Home Loan Mortgage Corporation participation certificates 2. Portfolio Composition A maximum of 80% of Available Funds may be invested in Federal • Instrumentalities. Callable securities are limited to 20%of Available Funds. The combined total of available funds invested in Federal Instrumentalities and Mortgage Backed Securities cannot be more than 80%. 3. Limits on Individual Issuers A maximum of 40%of Available Funds may be invested in individual Federal Instrumentalities. 4. Maturity Limitations The maximum length to maturity for an investment in any Federal Instrumentality security is seven (7)years from the date of purchase. E. Mortgage-Backed Securities (MBS) 1. Purchase Authorization Invest in mortgage-backed securities (MBS) which are based on mortgages that are guaranteed by a government agency or GSE for payment of principal and a guarantee of timely payment. 11 • DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 2. Portfolio Composition A maximum of 15%of available funds may be invested in MBS. The combined_ total of available funds invested in Federal Instrumentalities and Mortgage Backed Securities cannot be more than 80%. 3. Limits of Individual Issuers A maximum of 15%of available funds may be invested with any one issuer. 4. Maturity Limitations A maximum length to maturity for an investment in any MBS is five (5)years from the date of purchase. The maturity of mortgage securities shall be considered the date corresponding to its average life. This date reflects the point at which an investor will have received back half of the original principal (face) amount. The average life may be different from the stated legal maturity included in a security's description. F. Interest Bearing Time Certificates of Deposit or Saving Accounts 1. Purchase Authorization • Invest in non-negotiable interest-bearing time certificates of deposit or savings accounts in banks organized under the laws of this state and/or in national banks organized under the laws of the United States and doing business and situated in the State of Florida,provided that any such deposits are secured by the Florida Security for Public Deposits Act, Chapter 280, Florida Statutes 2. Portfolio Composition A maximum of 25% of Available Funds may be invested in non-negotiable interest-bearing time certificates of deposit or savings accounts. 3. Limits on Individual Issuers • A maximum of 15%of Available Funds may be deposited with any one issuer. 4. Maturity Limitations The maximum maturity on any certificate of deposit shall be greater than three(3)years from the date of purchase. 12 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 G. Repurchase Agreements 1. Purchase Authorization a. Invest in repurchase.agreements composed of only those investments based on the requirements set forth by the City's Master Repurchase Agreement. All firms are required to sign the Master Repurchase Agreement prior to the execution of a repurchase agreement transaction. b. A third-party custodian with whom the City has a current custodial agreement shall hold the collateral for all repurchase agreements with a term longer than one (1) business day. A clearly marked receipt that shows evidence of ownership must be supplied to the CFO and retained. c. Securities authorized for collateral are negotiable direct obligations of the United States Government, Government Agencies, and Federal Instrumentalities with maturities under five (5) years and must have a market value for the principal and accrued interest of 102 percent of the value and for the term of the repurchase agreement. Immaterial short- term deviations from 102 percent requirement are permissible only upon the approval of the CFO or Deputy Finance Director. d. Repurchase Agreements will be limited to transactions in which the proceeds will be used to provide liquidity. Any investment which is not issued in "Book Entry Only"form is physically held by the City in a secure vaulted area and surrendered only when invested funds and earnings are received by the City at maturity. 2. Portfolio Composition A maximum of 25% of Available Funds may be invested in repurchase agreements excluding one (1)business day agreements and overnight sweep agreements. 3. Limits on Individual Issuers • A maximum of 25% of Available Funds may be invested with any one institution excluding one (1) business day agreements and overnight sweep agreements. 4. Limits on Maturities The maximum length to maturity of any repurchase agreement is 90 days from the date of purchase. 5. Performance Calculation Overnight sweep investments for calculating investment performance and asset allocation requirements will be excluded from the calculations. • 13 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 H. Commercial Paper 1. Purchase Authorization Invest in commercial paper of any company operating in the United States that is rated, at the time of purchase, at a minimum "Prime-1" by Moody's or better and"A-1"by Standard&Poor's or better(prime commercial paper) or the equivalent by two NRSROs at the time of purchase. 2. Portfolio Composition A maximum of 25% of Available Funds may be directly invested in prime commercial paper. 3. Limits on Individual Issuers A maximum of 5%of Available Funds may be invested with any one issuer. 4. Maturity Limitations The maximum length to maturity for prime commercial paper shall be 270 days from the date of purchase. I. Corporate Notes • 1. Purchase Authorization Invest in corporate notes issued by corporations operating within the United States or by depository institutions licensed by the United States that have a long-term debt rating with a minimum"AA"rating category,or better,by any two NRSROs at the time of purchase. 2. Portfolio Composition A maximum of 40%of Available Funds may be directly invested in corporate notes. 3. Limits on Individual Issuers A maximum of 5%of Available Funds may be invested with any one issuer. 4. Maturity Limitations The maximum length to maturity for corporate notes shall be five (5) years from the date of purchase. J. Asset-Backed Securities (ABS) 1. Purchase Authorization The City may invest in asset-backed securities(ABS)which are bonds or notes backed by financial assets with a minimum "AA" rating category, or better, by any two NRSROs at the time of purchase. 14 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 2. Portfolio Composition A maximum of 15%of available funds may be invested in ABS. 3. Limits of Individual Issuers A maximum of 5%of available funds may be invested with any one ABS. 4. Maturity Limitations A maximum length to maturity for an investment in any ABS is five (5)years from the date of purchase. The maturity of asset-backed securities shall be considered the date corresponding to its average life. This date reflects the point at which an investor will have received back half of the original principal (face) amount. • The average life may be different from the stated legal maturity included in a security's description. K. Bankers'Acceptances 1. Purchase Authorization Invest in Bankers' Acceptances issued by a domestic bank or a federally chartered domestic office of a foreign bank, which are eligible for purchase by the Federal Reserve System,at the time of purchase,the short-term paper is rated,at a minimum,"P-1"by Moody's Investors Services or better and"A- 1"Standard &Poor's or better,or the equivalent by another NRSROs. 2. Portfolio Composition A maximum of 20% of Available Funds may be directly invested in Bankers' Acceptances. 3. Limits on Individual Issuers A maximum of 5%of Available Funds may be invested with any one issuer. 4. Maturity Limitations The maximum length to maturity for Bankers'Acceptances shall be 180 days from the date of purchase. L. State and/or Local Government Taxable and/or Tax-Exempt Debt 1. Purchase Authorization Invest in state and/or local government taxable and/or tax- exempt debt, general obligation and/or revenue bonds, rated,at the time of purchased, at a minimum single "A" category by any two NRSROs, or rated at a minimum "VMIG2" by Moody's or better and "A-2" by Standard & Poor's or better for short-term debt or the equivalent by another NRSRO. 15 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 2. Portfolio Composition A maximum of 20% of Available Funds may be invested in taxable and tax- exempt debts. 3. Limits on Individual Issuers A maximum of 10%of Available Funds may be invested with any one issuer. 4. Maturity Limitations A maximum length to maturity for an investment in any state or local government debt security is five (5)years from the date of purchase. M. Money Market Mutual Funds 1. Purchase Authorization Invest in shares in open-end and no-load money market mutual funds provided such funds are registered under the Federal Investment Company Act of 1940 and operate in accordance with 17 C.F.R. § 270.2a-7, which stipulates that money market mutual funds must have an average weighted maturity of 60 days or less. The money market mutual funds shall be rated, at a minimum, "AAAm" by Standard & Poor's or the equivalent by another NRSRO. The prospectus of such funds must indicate that the share value shall not fluctuate. 2. Portfolio Composition A maximum of 100% of Available Funds may be invested in money market mutual funds. 3. Limits of Individual Issuers A maximum of 50%of Available Funds may be invested with any one money market mutual fund. 4. Due Diligence Requirements A thorough investigation of any money market mutual fund is required prior to investing and on a quarterly basis. The questionnaire provided in Appendix E must be completed prior to investing.A current prospectus must be obtained prior to investing. 16 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • N. State of Israel Bonds 1. Investment Authorization Invest in Israel bonds, notes or instruments and backed by the full faith and credit of the government of Israel with a minimum Single "A" rating, or better,by Standard &Poor's or the equivalent by another NRSRO at the time of purchase 2. Portfolio Composition A maximum of 5% of Available operating Funds may be invested in Israel Bonds. No Bond Proceeds shall be invested in Israel Bonds. 3. Limits of Individual Issuers Not Applicable. 4. Maturity Limitations The maximum length to maturity for State of Israel Bonds shall be 3 years from the date of purchase. O. Intergovernmental Investment Pool 1. Investment Authorization Intergovernmental investment pools that are authorized pursuant to the Florida Interlocal Cooperation Act, as provided in Section 163.01, Florida Statutes and have a rating of"AAAm"by Standard&Poor's,or the equivalent by another NRSRO. 2. Portfolio Composition A maximum of 100% of Available Funds may be invested in intergovernmental investment pools. 3. Limits of Individual Issuers A maximum of 50% of Available Funds may be invested with any one intergovernmental investment pool. 4. Due Diligence Requirements A thorough investigation of any pool fund is required prior to investing and on a quarterly basis. The questionnaire provided in Appendix E must be completed prior to investing.A current prospectus must be obtained prior to investing. • 17 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 P. Florida League of Cities, Inc..Short Term Fixed Income Mutual Funds 1. Investment Authorization Florida League of Cities, Inc.Short Term Fixed Income Mutual Funds 2. Portfolio Composition A maximum of 25% of Available Funds may be invested in the Short Term Fixed Income Mutual Funds 3. Limits of Individual Issuers A maximum of 10%of Available Funds may be invested with any one Florida League of Cities, Inc. Short Term Fixed Income Mutual Fund. 4. Due Diligence Requirements A thorough investigation of the Funds is required prior to investing and on a quarterly basis. The questionnaire provided in Appendix E must be completed prior to investing. A current prospectus must be obtained prior to investing. Xl. DERIVATIVES • Derivatives shall.be utilized only if specifically authorized as part of the investment plan and the CFO or designee has sufficient understanding/expertise to invest in derivatives. All proposed derivative investments (including"SWAPS") will be analyzed by the City's Financial Advisor and will be presented to the Finance and Citywide Projects'Committee and the City commission for approval. XII. PROHIBITED INVESTMENTS Funds to be invested in cash management investments may not be invested in the following: Common Stock Private Placements Preferred Stock Convertible Bonds Margin Trading Venture Capital Options and Futures Oil and Gas Wells Warrants Foreign Exchange Short Selling Real Estate Limited Partnerships Commodities Any Inverse Floating Rate Securities Unregistered or Restricted 10 or PO Strips or Inverse Floater Mortgage Backed Stock Securities 18 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 In addition to the above prohibited investments,funds should not be invested in: a) any scrutinized companies with active business operations in Sudan or Iran as listed by the State Board of Administration (SBA)on a quarterly basis,which is outlined in the Protecting Florida's Investment Act (F.S. 215.442 and 215.473). b) any securities,stocks,or bonds issued by the Government of Venezuela or by any Company that is majority-owned by the Government of Venezuela or securities, stocks, or bonds issued by any institutions or companies doing business in or with the Government of Venezuela or any of its agencies or instrumentalities, in violation of Federal Law. The City Commission may waive the prohibitions in the subsection E (b) if the regime existing in Venezuela as of July 25,2018 collapses and there is an need for immediate aid to Venezuela for Humanitarian reason. XIII. AUTHORIZED INVESTMENT INSTITUTIONS AND DEALERS The City shall only purchase securities from financial institutions, which are qualified as public depositories by the CFO of the State of Florida or from primary dealers (or their agents) as designated by the Federal Reserve Bank of New York and regional dealers who meet the following qualifications and criteria: Qualified Financial Institutions and Securities Dealers A list of qualified financial institutions and securities dealers authorized to provide investment services will be maintained by the Investment Advisor. This list will include approved primary and non-primary dealers. All financial institutions and securities dealers who desire to conduct business with the City must supply the following as appropriate: 1. Most recent audited financial statements(must be provided annually). 2. Proof of State Registration. 3. Certification attesting that the individuals responsible for the City's account have reviewed the City's Investment Policy,that they agree to comply with the Policy, that they agree to undertake reasonable efforts to preclude imprudent transactions involving the City's funds, and that they will disclose potential conflicts or risks that may arise out of business transactions between the City and their organization. However, if the City's investment advisor is responsible for the investment transaction, the City will allow the investment advisor to use their professional judgment for the selection of the appropriate qualified financial institutions and securities dealers. 4. Executed repurchase agreements, wire transfer agreements, collateral/depository agreements, and other banking services contracts as appropriate. 19 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Selection Criteria The selection will be accomplished through pn objective rating system which rates financial institutions and securities dealers on both product and performance measures.The selection of firms by the City includes the following evaluation criteria: 1. Financial strength and security of the financial institution or dealer. 2. Institutional and dealer qualifications as they relate to both general and specific product knowledge. 3. Technical support capabilities as well as the operational efficiency of the organization. 4. Ability to provide value-added services. 5. Pricing competitiveness based on the ability to support both the "bid" and "ask"side of various securities market instruments. An annual review of the financial condition,registration,certification,and contracts of qualified financial institutions and securities dealers will be conducted by the investment advisor. The purpose of this process is to prevent influence being experienced by either City personnel or the financial institution in the selection'of the institution chosen for the purchase of City investments. XIV. THIRD-PARTY CUSTODIAL AGREEMENTS All securities purchased by the City under this section shall be properly designated as an asset of the City and held in safekeeping by a third-party custodial bank or other third-party custodial institution, chartered by the United States Government or the State of Florida and no withdrawal of such securities, in whole or in part, shall be made from safekeeping except by the CFO or designee as authorized herein. In addition, it may be found to be appropriate to accept confirmation from the trust company affiliated with the other party of the transaction if the structure of this affiliation is such that the two entities are fully independent of each other,that controls are adequate, and that the City's security interest in the assets is.not lost. Exceptions to this method of control will be the safekeeping of non-negotiable bank certificates of deposit, the Florida State Board of Administration, and various mutual funds which would require physical delivery without systematic handling found commonly with book entry securities. The City will execute third-party custodial agreements with a qualifying institution. Such agreements will include designation of authority from the City, details asp responsibilities of each party, notification of security purchases, sales, delivery, and wire transfers, safekeeping and transaction costs, procedures in case of wire failure, or other unforeseen conditions including liability of each party. 20 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Delivery vs. Payment All trades,where applicable,will be executed by delivery vs.payment(DVP)to ensure securities are deposited in the eligible financial institution prior to the release of funds.Securities will be held by a third-party custodian as evidenced by safekeeping receipts. XV. TREASURY MANAGEMENT SERVICES MASTER AGREEMENT A "Treasury Management Services Master Agreement" has been developed, reviewed and accepted by the City and is part of the contract established with the City's main depository bank. This agreement is a standard Public Securities Association ("PSA") form agreement offering all recommended protection to the City. This agreement is scheduled to be in effect for the duration of the contract with the City's main depository. XVI. BID REQUIREMENTS Where feasible and appropriate, purchases and sales of securities initiated by the City or the Investment Advisor should generally be accompanied by price quotes from three (3) separate brokers/dealers to ensure the acquisition of market-based prices. Documentation will be retained for all bids,with the winning bid clearly identified. Competitive bids are not applicable in instances where the City has executed a cash management agreement with an approved institution which addresses the considerations described in the third-party agreement section above. In certain circumstances where an institution or dealer informs the City or the Investment Advisor that a potential purchase or sale must be completed within minutes of notification,the competitive bidding Policy may be waived, providing the Coro designee specifically approves such individual transactions prior to execution. Periodically, various government agencies announced the issue of new securities to the financial markets. Since all new issues are generally sold at par, the City would not realize any benefit by purchasing these securities through the competitive bid process. In the case of such new issues of"to be announced" (TBA) securities,the competitive bidding process need not apply. • The formal bidding process for investment instruments consists of the following procedures (Steps#1 through#4 are performed by Investment Advisor): 1. Maintain a bid list of approximately three (3) major financial institutions qualified under Chapter 280 and two major brokerage firms. This bid list is adjusted periodically to delete bidders who are non-responsive or non-competitive over a period of time,replacing such institution(s)with other qualified institutions which have expressed an interest to bid on City funds. Qualified institutions are defined as financial institutions governed by Chapter 280 of the Florida Statutes with a branch location in Miami-Dade County, Florida. Brokerage houses must maintain an office in Miami-Dade County,Florida and are selected based on the amount of equity in the firm,number of years the firm has been in operation and reputation. 21 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 2. Place telephone calls requesting a bid from each institution on the bid list either on the day of the transaction or the afternoon immediately preceding the transaction date. 3. Receive and note all bids on a standard form designated for this purpose and retain on file for each transaction. 4. Select the highest winning bid 5. Transfer funds in exchange for evidentiary receipt from winning bidder. XVII. INTERNAL CONTROLS The City has established a number •f internal controls to prevent loss of funds by fraud, employee error, misrepresentation b third parties,or imprudent actions by employees of the City. The internal controls are as foll•ws: 1. Investment transactions auth•rity is limited to specific persons within the Finance Department. 2. Wire transfer of funds author ty is restricted to specific individuals with specific dollar limits within the Finance De•artment. All non-repeat type wire transfers require confirmation authorization by : second individual specified in wire authority documents executed with the City's main •epository. 3. All investment transactions re•uire the approval of the Treasury Manager in consultation with the Deputy Finance Dire 'or or CFO. 4. A monthly report is prepared •y the Investment Advisor and distributed to the Treasury Manager early in the subsequ nt month for review. In addition,the Finance Department receives a copy of this report and reconciles these investments with the City's general ledger on a monthly basis. 5. The Finance Department reco ciles the City's general depository account on a monthly basis by comparing the City's g:neral ledger with the applicable bank account statements. The reconciliation of the gen-ral depository account would reveal any difference in investment transaction record ng and the actual movement of funds. 6. Each month,the Finance Depa tment reconciles investments reflected in the custodial statements with the City's rec.rds. 7. Each year both internal audito s and the City's external auditors review existing internal controls as well as investment ransactions by examining data on a random basis. 22 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 XVIII. CONTINUING EDUCATION The CFO and any designees shall annually complete eight (8) hours of continuing education in subjects or courses related to investment practices and products. XIX. REPORTING The CFO or designee shall prepare a quarterly investment report, which includes a succinct management summary that provides a clear picture of the status of the current investment portfolio and transactions made over the last quarter.This report will be prepared in a manner which will allow the City to ascertain whether investment activities during the reporting period have conformed to the Policy. The report will include the following: • A listing of individual securities held at the end of the reporting period indicating type, transactions which occurred during the period, paramount (as well as adjusted cost basis), stated yield, maturity date, posted collateral, and actual investment earnings in dollars. • Unrealized gains or losses resulting from appreciation or depreciation by listing the cost and market value of securities over a one-year duration that are not intended to be held under maturity. • Average weighted yield to maturity of . the overall portfolio on investments as compared to applicable benchmarks. • The percentage of the total portfolio which each type of investment represents. • The Investment Advisor will provide a statement in the City's quarterly reports as to the whether the City's investments are in compliance with the Policy. Markincr-to-Market A statement of the market value of the portfolio shall be issued at least quarterly. This will ensure that the minimal amount of review has been performed on the investment portfolio in terms of value and subsequent price volatility. Review should be consistent with the GFOA Recommended Practice on Marking-to- Market Practices for State and Local Government Investment Portfolios and Investment Pools (see appendix). XX. SECURITIES Every security held on behalf of the City must be properly earmarked and: • If registered with the issuer or its agents, must be immediately placed for safekeeping in a location that protects the City's interest in the security; • If in book entry form, must be held for the credit of the governing body by a depository chartered by the Federal Government, the State of Florida, or any other state or territory of the United States which has a branch or principal place of business in the State of Florida as defined in Florida Statutes, Section 658.12, or by a national association organized and existing under the laws of the United States which is authorized to accept and exercise trusts and which is doing business in the State of 23 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Florida, and must be kept in the depository in an account separate and apart from the assets of the financial institution; or • If physically issued to the holder but not registered with the issuer or its agents, must be immediately placed for safekeeping in a secured vault. The City may also receive bank trust receipts in return for investment of surplus funds in securities. Any trust receipts received must enumerate the various securities held,together with the specific number of each security held. The actual securities on which the trust receipts are issued maybe held by any bank depository chartered by the Federal Government, the State of Florida,or any other state as defined in Section 658.12, Florida State Statutes,or by a national association organized and existing under the laws of the United States which is authorized to accept and execute trusts and which is doing business in the State of Florida. XXI. SALE OF SECURITIES When invested funds are needed in whole or in part for the purposes originally intended or for more optimal investments, the CFO or designee may sell such,investments at the then- prevailing market price and place the proceeds into the proper account or fund. XXII. PERFORMANCE MEASUREMENTS In order to assist in the evaluation of the portfolios' performance, the City will use nationally recognized performance measurements ("benchmarks") for the Short-Term and Long-Term portfolios. The use of benchmarks will allow the City to measure its returns against other investors in the same markets. Performance calculations will not include any balances invested in the overnight sweep accounts and savings accounts. Annually, the CFO will review the performance measurements to ascertain their continued relevance based on the composition of the City's portfolio. A. Investment performance of funds designated as short-term funds and other funds that must maintain a high degree of liquidity will be compared to the return on the S&P Rated GIP Index Government 30 Day Yield. Investments of current operating funds shall have maturities of no longer than twenty-four(24) months. B. Investment performance of the Long-Term Portfolio ("Core")will be compared to the BofA Merrill Lynch's 1-3 Year United States Treasury Index or an equivalent index comprised of U. S. Treasury or Government securities. The appropriate index will have a duration and asset mix that approximates the portfolio and will be utilized as a benchmark to be compared to the portfolio's total rate of return. 24 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 XXIII. INVESTMENT COMMITTEE The City may have an Investment Committee that meets on a quarterly basis to discuss the performance of the City's investment portfolios,the compliance of the portfolio with regard to the Policy,and items such as economic and market conditions. The Investment Committee will be made up of members selected by the CFO or designee. XXIV. EXEMPTIONS Any investment held that does not meet the guidelines of this Policy, at the time the Policy is adopted,shall be exempt from the requirements of this Policy.At maturity or liquidation,such • moneys shall be reinvested only as provided by this Policy. XXV. AMENDMENTS This Policy shall be reviewed by the CFO or designee on an annual basis.Any changes must be approved by the CFO or designee, the City Manager, and the City Commission, as well as the individual(s)charged with maintaining internal controls. XXVI. HISTORY OF AMENDMENTS November 18, 1987 Ordinance No. 87-2588 • September 16, 1992 Ordinance No. 92-2793 March 15, 1997 Ordinance No. 97-3074 September 27, 1995 Resolution No. 95-21726 March 5, 1997 Resolution No. 97-22315 July 11,2007 Resolution No. 2007-26602 January 11, 2012 • Resolution No. 2012-27816 September 12, 2018 Resolution No. 2018-30482 APPROVED AND ADOPTED BY THE MAYOR AND CITY COMMISSION ON 12-12-2018 RESOLUTION NO. 2018-30923 25 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Appendix A: Section 218.415, Florida Statutes DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 L,,UILU,o vw.uaco.,..,onstitutlon:View Statutes:Online Sunshine Select Year: 2018 • Go The 2018 Florida Statutes Title XIV Chapter 218 View Entire TAXATION AND FINANCIAL MATTERS PERTAINING TO POLITICAL Chapter FINANCE 'SUBDIVISIONS 218.415 Local government investment policies.—Investment activity by a unit of local government must be consistent with a written investment plan adopted by the governing body, or in the absence of the existence of a governing body, the respective principal officer of the unit of local government and maintained by the unit of local government or, in the alternative, such activity must be conducted in accordance with subsection (17). Any such unit of local government shall have an investment policy for any public funds in excess of the amounts needed to meet current expenses as provided in subsections (1)-(16), or shall meet the alternative investment guidelines contained in subsection (17). Such policies shall be structured to place the highest priority on the safety of principal and liquidity of funds. The optimization of investment returns shall be secondary to the requirements for safety and liquidity. Each unit of local government shall adopt policies that are commensurate with the nature and size of the public funds within its custody. (1) SCOPE.—The investment policy shall apply to funds under the control of the unit of local government in excess of those required to meet current expenses. The investment policy shall not apply to pension funds, including those funds in chapters 175 and 185, or funds related to the issuance of debt where there are other existing policies or indentures in effect for such funds. (2) INVESTMENT OBJECTIVES.—The investment policy shall describe the investment objectives of the unit of local government. Investment objectives shall include safety of capital, liquidity of funds, and investment income, in that order. • (3) PERFORMANCE MEASUREMENT.—The investment policy shall specify performance measures as are appropriate for the nature and size of the public funds within the custody of the unit of local government. (4) PRUDENCE AND ETHICAL STANDARDS.—The investment policy shall describe the level of prudence and ethical standards to be followed by the unit of local government in carrying out its investment activities with respect to funds described in this section. The unit of local government shall adopt the Prudent Person Rule, which states that: "Investments should be made with judgment and care, under circumstances then prevailing, which persons of prudence, discretion, and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived from the investment." (5) LISTING OF AUTHORIZED INVESTMENTS.—The investment policy shall list investments authorized by the governing body of the unit of local government, subject to the provisions of subsection (16). Investments not listed in the investment policy are prohibited. if the policy authorizes investments in derivative products, the policy must require that the unit of local government's officials responsible for making investment decisions or chief financial officer have developed sufficient understanding of the derivative products and have the expertise to manage them. For purposes of this subsection, a"derivative" is defined as a financial instrument the value of which depends on, or is derived from, the value of one or more underlying assets or index or asset values. If the policy authorizes investments in reverse repurchase agreements or other forms of leverage, the policy must limit the investments to transactions in which the proceeds are intended to provide liquidity and for which the unit of local government has sufficient resources and expertise. http://www.leg.state.fi.us/statutes/index.cfm7App_mode=Display_Statute&URL=0200-0299/0218/Sections/0218.415.html 1/4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 L/'I ui u I o .... ..onstitution:View Statutes:Online Sunshine (6) MATURITY AND LIQUIDITY REQUIREMENTS.—The investment policy shall require that the investment portfolio is structured in such manner as to provide sufficient liquidity to pay obligations as they come due. To that end, the investment policy should direct that, to the extent possible, an attempt will be made to match investment maturities with known cash needs and anticipated cash-flow requirements. (7) PORTFOLIO COMPOSITION.—The investment policy shall establish guidelines for investments and limits on security issues, issuers, and maturities. Such guidelines shall be commensurate with the nature and size of the public funds within the custody of the unit of local government. (8) RISK AND DIVERSIFICATION.—The investment policy shall provide for appropriate diversification of the investment portfolio. Investments held should be diversified to the extent practicable to control the risk of loss resulting from overconcentration of assets in a specific maturity, issuer, instrument, dealer, or bank through which financial instruments are bought and sold. Diversification strategies within the established guidelines shall be reviewed and revised periodically, as deemed necessary by the appropriate management staff. (9) AUTHORIZED INVESTMENT INSTITUTIONS AND DEALERS.—The investment policy should specify the authorized securities dealers, issuers,and banks from whom the unit of local government may purchase securities. (10) THIRD-PARTY CUSTODIAL AGREEMENTS.—The investment policy shall provide appropriate arrangements for the holding of assets of the unit of local government. Securities should be held with a third party; and all securities purchased by, and all collateral obtained by, the unit of local government should be properly designated as an asset of the unit of local government. No withdrawal of securities, in whole or in part, shall be made from safekeeping, except by an authorized staff member of the unit of local government. Securities transactions between a broker- dealer and the custodian involving purchase or sale of securities by transfer of money or securities must be made on a "delivery vs. payment" basis, if applicable, to ensure that the custodian will have the security or money, as appropriate, in hand at the conclusion of the transaction. (11) MASTER REPURCHASE AGREEMENT.—The investment policy shall require all approved institutions and dealers transacting repurchase agreements to execute and perform as stated in the Master Repurchase Agreement. All repurchase agreement transactions shall adhere to the requirements of the Master Repurchase Agreement. (12) BID REQUIREMENT.—The investment policy shall require that the unit of local government's staff determine the approximate maturity date based on cash-flow needs and market conditions, analyze and select one or more optimal types of investment, and competitively bid the security in question when feasible and appropriate. Except as otherwise required by law, the bid deemed.to best meet the investment objectives specified in subsection (2) must be selected. (13) INTERNAL CONTROLS.—The investment policy shall provide for a system of internal controls and operational procedures.The unit of local government's officials responsible for making investment decisions or chief financial officer shall establish a system of internal controls which shall be in writing and made a part of the governmental entity's operational procedures.The investment policy shall provide for review of such controls by independent auditors as part of any financial audit periodically required of the unit of local government. The internal controls should be designed to prevent losses of funds which might arise from fraud, employee error, misrepresentation by third parties, or imprudent actions by employees of the unit of local government. (14) CONTINUING EDUCATION.—The investment policy shall provide for the continuing education of the unit of local government's officials responsible for making investment decisions or chief financial officer. Such officials must annually complete 8 hours of continuing education in subjects or courses of study related to investment practices and products. (15) REPORTING.—The investment policy shall provide for appropriate annual or more frequent reporting of investment activities. To that end, the governmental entity's officials responsible for making investment decisions or chief financial officer shall prepare periodic reports for submission to the legislative and governing body of the unit of local government, which shall include securities in the portfolio by class or type, book value, income earned, and market value as of the report date. Such reports shall be available to the public. (16) AUTHORIZED INVESTMENTS; WRITTEN INVESTMENT POLICIES.—Those units of local government electing to adopt a written investment policy as provided in subsections (1)-(15)may by resolution invest and reinvest any surplus public funds in their control or possession in: http://www.leg.state.fl.us/statutesflndex.cfm7App_mode=Display_Statute&URL=0200-0299/0218/Sections/0218.415.html 2/4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 ICJ u v,cv i o .,.o.,.,00 .:onstitution:View Statutes:Online Sunshine (a) The Local Government Surplus Funds Trust Fund or any intergovernmental investment pool authorized pursuant to the Florida Interlocal Cooperation Act of 1969, as provided in s. 163.01. (b) Securities and Exchange Commission registered money market funds with the highest credit quality rating from a nationally recognized rating agency. (c) Interest-bearing time deposits or savings accounts in qualified public depositories as defined in s. 280.02. (d) Direct obligations of the United States Treasury. (e) Federal agencies and instrumentalities: (f) Rated or unrated bonds, notes, or instruments backed by the full faith and credit of the government of Israel. (g) Securities of, or other interests in, any open-end or closed-end management-type investment company or investment trust registered under the Investment Company Act of 1940, 15 U.S.C. ss. 80a-1 et seq., as amended from time to time, provided that the portfolio of such investment company or investment trust is limited to obligations of the United States Government or any agency or instrumentality thereof and to repurchase agreements fully collateralized by such United States Government obligations, and provided that such investment company or investment trust takes delivery of such collateral either directly or through an authorized custodian. (h) Other investments authorized by law or by ordinance for a county or a municipality. (i) Other investments authorized by law or by resolution for a school district or a special district. (17) AUTHORIZED INVESTMENTS; NO WRITTEN INVESTMENT POLICY.—Those units of local government electing not to adopt a written investment policy in accordance with investment policies developed as provided in subsections (1)-(15) may invest or reinvest any surplus public funds in their control or possession in: (a) The Local Government Surplus Funds Trust Fund, or any intergovernmental investment pool authorized pursuant to the Florida Interlocal.Cooperation Act of 1969, as provided in s. 163.01. (b) Securities and Exchange Commission registered money market funds with the highest credit quality rating from a nationally recognized rating agency. (c) Interest-bearing time deposits or savings accounts in qualified public depositories, as defined in s. 280.02. (d) Direct obligations of the U.S.Treasury. The securities listed in paragraphs (c) and (d) shall be invested to provide sufficient liquidity to pay obligations as they come due. • (18) SECURITIES; DISPOSITION.— (a) Every security purchased under this section on behalf of the governing body of a unit of local government must be properly earmarked and: 1. If registered with the issuer or its agents, must be immediately placed for safekeeping in a location that protects the governing body's interest in the security; 2. If in book entry form, must be held for the credit of the governing body by a depository chartered by the Federal Government, the state, or any other state or territory of the United States which has a branch or principal place of business in this state as defined in s. 658.12, or by a national association organized and existing under the laws of the United States which is authorized to accept and execute trusts and which is doing business in this state, and must be kept by the depository in an account separate and apart from the assets of the financial institution; or 3. If physically issued to the holder but not registered with the issuer or its agents, must be immediately placed for safekeeping in a secured vault. (b) The unit of local government's governing body may also receive bank trust receipts in return for investment of surplus funds in securities. Any trust receipts received must enumerate the various securities held, together with the specific number of each security held. The actual securities on which the trust receipts are issued may be • held by any bank depository chartered by the Federal Government, this state, or any other state or territory of the United States which has a branch or principal place of business in this state as defined in s. 658.12, or by a national association organized and existing under the laws of the United States which is authorized to accept and execute trusts and which is doing business in this state. http://www.leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0200-0299/0218/Sections/0218.415.html 3/4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 iu,cu 10 owwtea a..onstitution:View Statutes:Online Sunshine (19) SALE OF SECURITIES.—When the invested funds are needed in whole or in part for the purposes originally intended or for more optimal investments, the unit of local government's governing body may sell such investments at the then-prevailing market price and place the proceeds into the proper account or fund of the unit of local government. (20) PREEXISTING CONTRACT.—Any public funds subject to a contract or agreement existing on October 1, 2000, may not be invested contrary to such contract or agreement. (21) PREEMPTION.—Any provision of any special act, municipal charter, or other law which prohibits or restricts a local governmental entity from complying with this section or any rules adopted under this section is void to the extent of the conflict. (22) AUDITS.—Certified public accountants conducting audits of.units of local government pursuant to s. 218.39 shall report, as part of the audit, whether or not the unit of local government has complied with this section. (23) AUTHORIZED DEPOSITS.—In addition to the investments authorized for local governments in subsections (16) and (17)and notwithstanding any other provisions of law, a unit of local government may deposit any portion of surplus public funds in its control or possession in accordance with the following conditions: (a) The funds are initially deposited in a qualified public depository, as defined in s. 280.02, selected by the unit of local government. (b) The selected depository arranges for depositing the funds in financial deposit instruments insured by the Federal Deposit Insurance Corporation in one or more federally insured banks or savings and loan associations, wherever located, for the account of the unit of local government. (c) The full amount of the principal and accrued interest of each financial deposit instrument is insured by the Federal Deposit Insurance Corporation. (d) The selected depository acts as custodian for the unit of local government with respect to each financial deposit instrument issued for its account. History.—s. 1,ch.95-194;s.2,ch. 97-9;s.3,ch.2000-264;ss.66, 141,ch.2001-266;s.2,ch.2005-126;s. 1,ch.2007-89;s.42,ch. 2008-4;s.2,ch.2009-140. • Copyright O 1995-2018 The Florida Legislature• Privacy Statement • Contact Us http://www.leg.statenus/statutes/index.cfm?App_mode=Display Statute&URL=0200-0299/0218/Sections/0218.415.html 4/4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • Appendix B: GFOA Recommended Practices DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 ,u,urcu,o COM/1101ling a Policy for Repurchase Agreements Government Finance Officers Association • EST � CTCI Establishing a Policy for Repurchase Agreements BACKGROUND: Where permitted by statute and investment policy,governmental entities often enter into Repurchase Agreements(repos)to invest funds on a short-term basis primarily to fund liquidity needs. Repos are contractual financial transactions in which an investor(e.g.governmental entity)purchases securities from a bank or dealer with a simultaneous contractual agreement by both parties to reverse the transaction at the same price(plus interest)at some mutually agreed-upon future date.The parties to the agreement(governmental entity and bank/dealer)are commonly referred to as counterparties. Repos are an integral part of an investment program of state and local governments and provide an alternative or supplement to local government investment pools, money market mutual funds and other money market instruments. However,like all investments,there are associated risks with repos,one in particular is the counterparty's credit risk.Such risk can be mitigated by the utilizing proper securitization practices. Common Types of Repos: • Overnight Repo:refers to a repo that goes from one business day to the next business day. These repos have a negotiated fixed interest rate. • Term Repo:refers to a repo agreement with a specified maturity of several days to several weeks.Term repos can be established for up to several years when the investment policy permits.The interest rate for the period is usually fixed. • Open Repo:typically,has no maturity date,and renews daily until terminated by either one of the counterparties.The interest rate adjusts daily to the overnight rate and is averaged for the • period of the repo. • Flex Repo(flexible repurchase agreements):are often used for the reinvestment of bond proceeds used for capital projects.These repos are often for multi-year periods associated with a specific capital program.The flexible portion of the agreement permits multiple cash draw-downs to fund the expenditure requirement.Governments should ensure that these investments meet the liquidity requirements of the project and adhere to any bond covenants. • Tri-Party Repo:occurs when a custodian(a.k.a.the tri-party agent)participates as an intermediary between the two parties(investor and lender)of the repo.The custodian administers and ensures the transaction occurs simultaneously and that necessary safeguards are in place to protect the underlying securities during term of the repo. Benefits of Repos: • Repos are safe when properly established and monitored; • At times, provide higher yields than other money market alternatives; • Provide diversification to other money market investments;and http://www.gfoa.org/print/572 1/4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 141 I V/LV 10 1-01o�1101 ding a Policy for Repurchase Agreements • Provides flexibility. Risks Associated with Repos: • The repurchase agreement with an entity's counterparty is not properly established; • The financial strength of the counterparties and value of the collateral are not properly monitored; • The bank or dealer cannot buy securities back when repo is closed by governmental entity. • The collateral for the repo is not liquid or easily marketable;and • The value of the repo is not sufficient to cover the funds invested and interest earned. Mitigating the Risk: • Execute a SIFMA Master Repurchase Agreement including additional provisions specific to the governmental agency that is signed by a duly authorized officer with each counterparty; • Establish financial strength criteria for counterparties and review financial statements at inception of relationship and at least annually.Some entities will limit counterparties to primary dealers; • Allow only highly marketable,easily priced collateral priced at a minimum of 102%and monitoring their value at least weekly;and • Have collateral settled delivery-versus-payment(DVP)at the entity's custodian or trustee for third-party safekeeping. Master Repurchase Agreement.A Master Repurchase Agreement is the contractual agreement a governmental entity enters into with a bank or counterparty.A form of the agreement,also known as a blanket agreement may be obtained from the website of the Securities Industry and Financial Markets Association(SIFMA)formerly known as The Bond Market Association(TBMA). However, governmental entities may wish to amend SIFMA's form of the Master Repurchase Agreement to suit the specificities of their respective transactions. A master repurchase agreement governs the repurchase transaction.An agreement should reflect the following characteristics: • Defines and provides detail as to the nature of the transaction; • Identifies the relationship of the parties to the agreement; • Establishes the parameters concerning the ownership and custody of the collateral securities for the term of the agreement; • May include right to substitute collateral during the term of the agreement;and • Provides for remedies in the event of default by either party. SIFMA has also published an optional substitution/termination provision to its Master Repurchase Agreement that allows the repo seller(bank or dealer)to retain effective control over the purchased securities,or the repo seller could elect to terminate the transaction prior to maturity on short notice to the repo buyer(government entity). Securitization Provisions. Safekeeping: In order to protect public funds,governmental entities should ensure proper securitization practices when utilizing repurchase agreements for investments.Safekeeping should be performed by an independent or third-party custodian. Duties of the custodian(direct or tri-party) should be outlined in a written safekeeping agreement. Collateral:The underlying security of a repurchase agreement is collateral.Collateral arrangements for repurchase agreements are short-term and liquid in nature.Typical collateral instruments are U.S.Treasuries(e.g. U.S.Treasury bills)and governmental agency securities(e.g.Farm Credit Banks,Home Loan Banks bonds).Governmental entities should be aware of the risk factors of the http:/lwww.gfoa.org/print/572 2/4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 iu WILL/10 Cbtounatling a Policy for Repurchase Agreements underlying collateral instrument for the repo and refer to their respective investment policies to verify if such collateral Instruments are permissible to utilize for the repurchase transaction.The purchased securities(collateral)to collateralize the repurchase agreement should maintain a market value in excess of the value of the repurchase agreement(called margin,"haircut,"or over securitization). Although governmental entities are not bound by the Financial Accounting Standards Board(FASB), FASB Statement No.140 affects the counterparties to repurchase transactions with governments. FASB Statement No. 140,"Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities,"generally provides that if the repo buyer(i.e.,government entity)has the right to sell or substitute the securities,then the repo seller(i.e., bank or dealer)does not have the right to substitute the securities or terminate the contract on short notice.The repo buyer will be obligated to record both the securities,together with any obligation to return the securities.The repo seller will be required to reclassify the securities from a securities inventory or investment account to a securities collateral account on its balance sheet.Accordingly,the nature of the underlying repurchase agreement may change from a buy-sell transaction to a collateralized loan.This change of treating repurchase agreements as collateralized loans would make them illegal for local governments in many states. RECOMMENDATION: GFOA recommends that state and local government finance officers develop policies and procedures to ensure the safety of repos. The following actions are recommended: 1.Government entities and investment officers should exercise special caution in selecting and evaluating the creditworthiness of counterparties with whom they will conduct repurchase transactions and be able to identify the parties acting as principals to the transaction. 2.Master repurchase agreements should be employed,subject to appropriate legal and technical review. Governments using the prototype agreement developed by SIFMA should include appropriate supplemental provisions regarding the types of securities,delivery, substitution,margin maintenance, margin amounts,seller representations,and governing law as contained in the GFOA-developed Considerations for Governments in Developing a Master Repurchase Agreement. 3.Government entities'legal department should review SIFMA's optional substitution/termination provision in its master agreement to assure no loss has incurred (e.g. in event of a default). In jurisdictions where substitution of securities is permitted,a loss provision is provided that is intended to place the repo buyer in the same position it would have been had the repo seller not exercised the substitution/termination right. However,in jurisdictions where substitution is restricted,the effect of FASB Statement No.140 may be troublesome depending on the relationship established with the bank or dealer;the jurisdiction's position with respect to the change in accounting treatment of the transaction; and whether the government has the ability to avoid the restriction on substitution of purchased securities. 4.Proper securitization practices are necessary to protect the public funds invested in repurchase agreements.Safekeeping duties should be performed by a third-party custodian in accordance with an executed agreement.The purchased securities(collateral)to collateralize the repurchase agreement should maintain a market value in excess of the value of the repurchase agreement(called margin,"haircut,"or over securitization). Routine market valuing of the purchased securities during the term of the repurchase agreement should be a mandatory practice in order to ensure the purchased securities maintain sufficient market value to cover any default.A typical margin requirement for a short-term repo using US Treasuries or US agency securities as collateral is at least 102%and higher(typically 105%) for other securities. http://www.gfoa.org/print/572 3/4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 l a!u,cu i o a Policy for Repurchase Agreements 5.Consideration should be given to restricting the allowable securities that are used for . collateral.Entities may prefer to only allow for security maturity and security types that are allowable for direct investment under their policy.If there is a default of the counterparty,the securities held as collateral of the repo will be owned by the entity,supporting the need to restrict the maturity and type of security to what is allowable under policy. References: • "Do You Know Your Repurchase Agreements as Well as You Think?"GFOA's Treasury Management Newsletter,October 3,2009,Volume 27,Number 10. • An Introduction to Broker-Dealers for State and Local Governments, Second Edition,Sofia Anastopoulos,GFOA,2008. • "GFOA Best Practice,Securities Lending Programs"(1995,2002,2008). • An Introduction to Collateralizing Public Deposits for State and Local Governments, Second Edition,M.Corinne Larson,GFOA,2006. • GFOA Best Practice, Frequency of Purchased Securities Valuation In Repurchase Agreements(1999,2003,2006,2008). • • Investing Public Funds, Second Edition,Girard Miller with M.Corinne Larson and W.Paul Zorn, GFOA, 1998. • "GFOA Best Practice,Securities Lending Programs"(1995,2002,2008).. • Sample Custodial Trust Agreement,GFOA. • FASB Statement 140,"Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities,"http://www.fasb.org/pdf/fas140.pdf. • The Securities Industry and Financial Markets Association(SIFMA)http://www.sifma.org 203 N.LaSalle Street-Suite 2700 I Chicago,IL 60601-1210 I Phone:(312)977-9700-Fax:(312)977-4806 http://www.gfoa.org/print/572 4/4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 lu/Lulo Collateralizing Public Deposits Government Finance Officers Association 0 El kak. zi, —Tr Collateralizing Public Deposits BACKGROUND: The safety of public funds should be the foremost objective In public fund management. Collateralization of public deposits through the pledging of appropriate securities or other instruments(i.e.surety bonds or letters of credit)by depositories is an important safeguard for such deposits.The amount of pledged collateral is determined by a governmental entity's deposit level and the policy or legal required collateral margin.Some states have established programs for the pooling of collateral for deposit of public funds. Federal law imposes certain limitations on collateral agreements between financial institutions and public entities in order to secure governmental entity deposits.Under certain circumstances,as are discussed in recommendations below,the Federal Deposit Insurance Corporation(FDIC)may void an otherwise perfected security interest and leave the governmental depositor.with only the right to share with other creditors in the pro rata distribution of the assets of a failed institution for the amount of deposits that exceed the FDIC coverage.Separate governmental'corporations'such as economic development corporations or water supply corporations,etc.,do not fulfill the FDIC's definition of 'public unit'1 and therefore even accurately completed collateral definition may not be honored by the FDIC on a bankruptcy. RECOMMENDATION: GFOA recommends the use of a written agreement with pledging requirements as protection for state or local government's deposits.GFOA encourages governmental entities to establish adequate and efficient administrative systems to monitor such pledged collateral,including state or locally administered collateral pledging or collateral pools.To accomplish these goals,GFOA recommends the following: 1. Governmental entities should implement programs of prudent risk control.Such programs could Include a formal depository risk policy, credit analysis, and use of fully secured investments. In the absence of a state program for pooling collateral, public entities should establish and implement collateralization procedures,including procedures to monitor their collateral positions.Monitoring informs a public entity of undercollateralization,which may threaten the safety of an entity's deposits, and overcollateralization,which may increase the cost of banking services.Governmental entities however can not and should not accept the liability for maintaining collateral levels which liability must fall to the financial institution. 2.Governmental entities/depositors should take all possible actions to comply with state and federal requirements in order to ensure that their security interests in collateral pledged to secure deposits are enforceable against the receiver of a failed financial institution. Federal law provides that a depositor's security agreement,which tends to diminish or defeat the interest of the FDIC in an asset http://www.gfoa.org/print/570 1/3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 1'L/1U, U1C Collateralizing Public Deposits acquired by it as receiver of an insured depository,shall not be valid against the FDIC unless the • agreement: o is in writing; o was approved by the board of directors of the depository or its loan committee and2 o has been, continuously,from the time of its execution,an official record of the depository institution.3 3.Governmental entities should have all pledged collateral held at an independent third-party institution outside the holding company of their bank,and evidenced by a written agreement in an effort to satisfy the Uniform Commercial Code(UCC)requirement for control.The UCC states that the depositor does not have a perfected interest in a security unless the depositor controls it. Control means that swaps,sales,and transfers cannot occur without the depositor's written approval. o The value of the pledged collateral should be marked to market monthly,or more frequently depending on the volatility of the collateral pledged.Some state statutes do dictate a minimum margin level for collateral based on deposit levels(e.g.,Georgia and Minnesota statutes require 110 percent). If not,the margin levels should be at least 102 percent,depending on the liquidity and volatility of the collateral pledged. State statutes also govern whether minimum margin levels apply to principal only or to accrued interest as well.On a sale,accrued interest would be received.Governmental entities should review applicable state statutes and confirm compliance. o Substitutions of collateral should meet the requirements of the collateral agreement, be approved,by the entity in writing prior to release,and the collateral should not be released until the replacement collateral has been received. o The public entity should require reporting directly from the custodian.The custodian should warrant and be signatory to the agreement o Reporting by the third party institution should at a minimum be monthly. 4.The pledge of collateral should comply with the investment policy or state statute,whichever is more restrictive.Governmental entities should know and understand securities pledged as collateral. 5.Governmental entities that use surety bonds in lieu of collateral should limit the insurers to those of the highest credit quality as determined by a nationally recognized insurance rating agency.A thorough review of the terms of the bond is required. 6.The governmental entity should thoroughly review the terms and conditions of any letters of credit, including those issued by a federal agency or government sponsored enterprise. 7.The governmental entity should establish and follow procedures for on-going review of collateral. Note:As a result of the court case North Arkansas Medical Center v. Barrett,963 F.2d 780(8th Cir. 1992),the FDIC issued a policy statement in March 1993 indicating that it would not seek to void a security interest of a federal,state,or local public unit solely because the security agreement did not comply with the contemporaneous execution requirement set forth in Section 13(e)of the Federal Deposit Insurance Act 12 U.S.C.1823(e).The policy statement was officially enacted by Section 317 of the Riegle Community Development and Regulatory Improvement Act of 1994(Public Law 103- 325). • Notes: 1 For deposit insurance purposes,the term"public unit"includes a state,county, municipality,or "political subdivision"thereof.Governments should review Section 330.15 of the FDIC's regulations (12 C.F.R.330.15)to identify if they fall within the FDIC's definition of"public unit"and to determine http:llwww.gfoa.orglprint1570 2/3 Do uS gn10 velope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 Collateralizing Public Deposits whether they are public entity qualifying for collateral protection under the definition.This information can be found at http://www.fdic.gov/deposit/deposits/FactSheet.html 2 The FDIC does not require every transaction to be reviewed by the board of directors.The board may fulfill this function by setting parameters and authorizing a particular officer to carry out its wishes.The officer would be performing ministerial acts on behalf of the board.(FDIC Interpretive Letters) 3 Corporate resolutions that list specific officers who are authorized by the board of directors to execute agreements securing public deposits will meet this requirement. References: • GFOA Sample Security Agreement(long and short versions),www.gfoa:org,2009. • GFOA Sample Custodial Trust Agreement,www.gfoa.org,2006. • An Introduction to Collateralizing Public Deposits for State and Local Governments,Second Edition, M.Corinne Larson,GFOA,2006. • Investing Public Funds, Second Edition,Girard Miller with M.Corinne Larson and W.Paul Zorn,GFOA, 1998. • FDIC Act(12 U.S.C. 1811 et seq.and 12 C.F.R. Part 330.330.15 Public Unit Accounts (www.FDIC.gov) 203 N.LaSalle Street-Suite 2700 I Chicago,IL 60601-1210 I Phone:(312)977-9700-Fax:(312)977-4806 http://www.gfoa.org/print/570 3/3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 141 i vr4V ICI ..,..dal Funds for Cash Management Purposes G[) Government Finance Officers Association • E AcTIcE Using Mutual Funds for Cash Management Purposes BACKGROUND: State and local government cash managers may benefit from investing public monies through mutual funds. Mutual funds are SEC-regulated investment instruments that pool and jointly invest monies of multiple investors.Mutual funds are available for both fixed income and equity investments. Short-term liquid fixed income mutual funds that maintain a weighted average maturity of 60 days or less and have a stated aim to maintain investor shares with a constant one dollar($1)Net Asset Value(NAV)are called money market mutual funds.While these funds seek to maintain a constant or stable NAV,this is not guaranteed and investors of public monies should be aware of this risk. Other non-money market fixed income mutual funds generally have a longer-term weighted average maturity and also have a fluctuating price or NAV. The Government Finance Officers Association(GFOA)has endorsed the use of money market mutual funds by public cash managers in the past.Portfolio safety, liquidity,diversification,and professional management are desirable features of these investment vehicles;however,liquidity may be impaired by the floating NAV. RECOMMENDATION: The GFOA recommends that state and local governments restrict their use of mutual funds for cash management purposes exclusively to: (1)money market mutual funds that are invested in Treasury, federal government agency,or first tier categories and possess the highest ratings available from at least one nationally-recognized ratings agency and(2)short-term bond funds that receive the highest credit quality ratings and the lowest risk ratings available. Risk Assessment.When analyzing risk,the following should be taken into consideration: 1.Local Investment Policy.State and local government cash managers should exercise prudence and caution when investing in short-term bond funds. Public cash managers should also check applicable statutes to determine if the use of money market mutual funds and/or short-term bond funds is permitted within their jurisdictions. 2.Fund Prospectus.Before investing,governments should review and understand a fund's prospectus and statement of additional information to determine: 1.Portfolio composition; 2.Risk characteristics; 3.The duration and weighted average maturity of the mutual fund; 4.The reputation and experience of the investment company; • 5.The performance history relative to appropriate benchmarks; • http://www.gfoa.org/print/3561 1/2 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31BIA2C0 1'GIl Ul UI0 using mutual Funds for Cash Management Purposes 6.Total expense ratio; 7.Philosophy,strategies,and portfolio policies; 8.If the fund is rated by a nationally recognized rating agency;and 9.Whether the fund can meet the compliance requirements of the government's approved investment policy. Cash managers should continue to monitor these characteristics as they may change over time. 3.Restriction on Redemptions(Gates). Prior to investing in a money market mutual fund, cash managers should familiarize themselves with any restriction gates assessed against the fund which could impair the ability of an entity to withdraw monies from the fund on a timely basis in order to meet current liquidity requirements. 4. Fees. During extremely low interest rate environments,mutual fund expenses may exceed yield.While fees are included in all mutual funds,these fees should be considered when investing in mutual funds. Investors should assess the risk that the net yield(gross yield minus expenses)will be less than zero—in some cases it may be more beneficial to own the underlying securities directly. 5.Duration.Bond funds investing in shorterm instruments,with a varying NAV,may be legal and appropriate investments in some jurisdictions when monies are not needed for near-term • disbursement. However,mutual funds of an intermediate or long-term duration should be avoided by investors if short-term liquidity is a concern. 6.Holdings. Investors should review the specific holdings of their mutual fund at least monthly to know what underlying securities the fund owns.Prime money market funds that are AAA rated and hold A1+paper may have foreign debt exposure that is not obvious. In addition, Investors should review the NAV at least monthly. If the NAV varies below$0.995(known as "breaking the buck"), investors should reevaluate their investments in these funds. Governments should consider investing in money market funds that Invest in US government securities,which have a higher level of safety and will not be subject to the floating NAV. References: • GFOA Best Practice—Managing Market Risk in Investment Portfolios • An Introduction to Investment Advisers for State and Local Governments, Second Edition, Sofia Anastopoulos, GFOA,2007. • A Public Investor's Guide to Money Market Instruments,Second Edition,edited by M.Corinne Larson, GFOA, 1994. • Investing Public Funds, Second Edition, Girard Miller with M. Corinne Larson and W.Paul Zorn,GFOA, 1998. 203 N.LaSalle Street-Suite 2700 I Chicago,IL 60601-1210 I Phone:(312)977-9700-Fax:(312)977-4806 http:/Iwww.gfoa.org/print/3561 2/2 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 "I I U/LU 10 VuvC11111Ient Relationships with Securities Dealers Government Finance Officers Association ro' EST riR,-*, :: . TICp Government Relationships with Securities Dealers BACKGROUND: Finance officers,treasurers and investment officers(hereafter referred to as government investors) who manage and invest public funds place billions of dollars in the fixed-income and money markets on a daily basis.They have a fiduciary responsibility to protect public funds,to always act in the best interest of their entity,to maintain safety and an appropriate level of liquidity and to attain a competitive return on their portfolio. Generally,access to the securities markets is made through securities dealers who are registered broker/dealers and through financial institutions(banks)with broker/dealer subsidiaries.The fiduciary responsibilities of a government investor include ensuring that: • reasonable comparisons are made to judge the appropriateness of all investments; • securities meet the criteria established in the investment policy,including liquidity,diversity and risk of investments; • security transactions are made on a best execution basis through a competitive process; • the counterparty to the transaction will fulfill all of Its obligations;and, • the securities are properly safe-kept at a qualified custodial agent in a segregated account. It is important to note that brokers/firms may have unique strengths that may provide exceptional value within a specific category of investments,provided that you understand the security that you are purchasing,it dovetails with your investment policy,and you are aware of the risks associated with the transaction. A unique strength may compliment the skills and abilities of other approved brokers/firms. Communication with broker/dealers for the purposes of discussing market conditions,reviewing investment strategies and transacting a trade often occurs by phone,e-mail,or fax. Regardless of the method of communicating with a broker,a government investor needs to perform due diligence on all securities dealers prior to adding them to their list of approved brokers/dealers for transacting trades. RECOMMENDATION: GFOA makes the following specific recommendations to government investors in selecting securities dealers for their approved vendor list,managing the relationships with the broker/dealers,and conducting investment transactions with them: 1.All securities are held in a third party bank separate from the broker/dealer that is transacting business. http://www.gfoa.org/print/577 1/3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 la M urcu'0 Wvvoi I,1 i ioitt Relationships with Securities Dealers 2.Use a defined internal process to select,qualify, renew,or terminate brokers and dealers. 1.Use a questionnaire, conduct an interview,and/or conduct peer references to help determine that the broker understands the public entity's needs/objectives. 2.Determine that the broker is actively involved in the market sectors utilized by the government entity. 3.Select a number of brokers suitable to the entity,allowing for appropriate competition/service on all transactions,while limiting it to a manageable number. 4.Require security brokers and dealers to comply with the Federal Reserve Bank of New York's capital adequacy guidelines or SEC Net Capital Rule as a condition of doing business.Obtain annual financial reports of the securities firm. 5.Require that brokers provide written acknowledgement or certification of their review and understanding of the government entity's investment policy to assure compliance with its objectives, portfolio risk constraints,and investment trading requirements. 6. Record and retain pertinent information on the firm and the individual broker including an annual review of the Central Registration Depository(CRDO)Information for both maintained by the Financial Industry Regulation Authority(FINRA). Violations or sanctions imposed by a regulatory agency or government should be carefully reviewed for termination of relationship. • 7.Establish parameters that guide periodic review and potential termination of a broker dealer relationship. 8. Do not select or approve more broker/dealers than will be reasonably used. It is better to develop good relationships with a small number of approved dealers than to have a long list of firms who transact little or no business with the investing entity. 3.Due diligence on broker/dealers should include obtaining information on: 1.a security dealer's experience and knowledge of public funds investing; 2.all contact information for the primary contact,backup and operations staff; 3.a broker's manager and supervisor; 4.the financial strength of the firm; 5.areas of expertise and trading activity; 6.registration with FINRA and any citations; 7.the names and contact information for references similar to the entity;and 8.potential conflicts of interest. 4.Establish a competitive procedure for attaining reasonable market rates on investment transactions: 1.Require that all security sales be made through a competitive bid process. If possible, use a competitive offer process on purchases as well. 2.Securities sold through a selling group at a set price(usually par)or available for specific bidding should be compared to comparable maturity securities as part of the competitive process to determine the best relative value. 5.Require that all security transactions be settled on a delivery versus payment basis at the entity's custodian bank to perfect ownership under a written custodial agreement. 6. Retain complete transaction documentation for audit trail purposes including trade tickets, confirmations and safekeeping receipts. 7.Electronic trading platforms,such as Bloomberg and Tradeweb,are becoming another alternative to competitive pricing. These platforms can provide improved transparency over competitive bids and should be considered if cost effective for the government. It is still important to have a broker assigned to the account on the electronic platforms so that contact can be made if necessary. The same due diligence should be completed with all broker dealers on the electronic platforms. 8.Follow all state and entity ethics policies when dealing with all broker/dealers and investment vendors. References: http://www.gfoa.org/print/577 2/3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 1211UrZU1 tt tovernment Relationships with Securities Dealers • Introduction to Broker-Dealers for State and Local Governments,Second Edition,Sofia Anastopoulos, GFOA,2008. • Investing Public Funds,Second Edition,Girard Miller with M.Corinne Larson and W. Paul Zorn, GFOA, 1998. • Federal Reserve Bank of New York,www.frb.ny.gov, http://www.newyorkfed.org/rnarkets/pridealers Jisting.html. • WWW.FINRA.GOV;http://www.nasd.com/web/idcplg? IdcService=SS_G ET_PAG E&nodeld=370. • Securities and Exchange Commission,www.sec.gov,VI. Financial Responsibility of Broker Dealers,A. Net Capital Rule 15c3-1 (17 CFR 240.15c3-1) http://www.sec.gov/divisions/marketreg/bdguide.htm#V1. 203 N.LaSalle Street-Suite 2700 I Chicago,IL 60601-1210 I Phone:(312)977-9700-Fax:(312)977-4806 http://www.gfoa.org/print/577 3/3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Appendix C: Investment Firm Certification Form DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 INVESTMENT FIRM CERTIFICATION FORM As an authorized representative of the undersigned firm,I hereby certify that the firm has in place reasonable procedures to monitor the activities of this firm engaged in transactions between our firm and the City of Miami Beach. All sales personnel of this firm dealing with the City of Miami Beach have been informed and will be routinely informed of the City's. investment objectives, policies,risk constraints and other pertinent factors,whenever we are so informed.This firm further pledges due diligence in informing the City of foreseeable risks associated with financial transactions connected with this firm. (Firm) Authorized Representative (Signature) (Title) (Name- Printed) (Date) As account representative for the City on behalf of the above referenced firm I hereby certify that I have personally read and understand that investment policies of the City, in such form as the policies were provided to me. I agree to use my best efforts to comply with the City's written policies and will not knowingly enter into any transaction with the City, which appears to be in violation of the City's written policies. Account Representative (Signature) (Title) • (Name- Printed) (Date) DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Appendix D: Master Repurchase Agreement DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Appendix E: Investment Pool/Fund Questionnaire DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • Investment Pool/Fund Questionnaire 1. A description of eligible investment securities, and a written statement of investment policy and objectives. 2. A description of interest calculations and how it is distributed, and how gains and losses are treated. • 3. A description of how the securities are safeguarded (including the settlement processes), and how often the securities are priced, and the program audited. 4. A description of who may invest in the program, how often, what size deposit and withdrawal are allowed. 5. A schedule for receiving statements and portfolio listings. 6. Are reserves, retained earnings, etc. utilized by the pool/fund? 7. A fee schedule, and when and how is it assessed. 8. Is the pool/fund eligible for bond proceeds and/or will it accept such proceeds? DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Appendix F: Glossary of Cash and Investment Management Terms DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 The following is a glossary of key investing terms,many of which appear in the City's investment policy. This glossary clarifies the meaning of investment terms generally used in cash and investment management. This glossary has been adapted from the GFOA Sample Investment Policy and the Association of Public Treasurers of the United States and Canada's Model Investment Policy. Accrued Interest. Interest earned but which has not yet been paid or received. Agency. See "Federal Agency Securities." Ask Price. Price at which a broker/dealer offers to sell a security to an investor. Also known as "offered price." Asset Backed Securities (ABS). A fixed-income security backed by notes or receivables against assets other than real estate. Generally issued by special purpose companies that"own" the assets and issue the ABS. Examples include securities backed by auto loans, credit card receivables, home equity loans, manufactured housing loans, farm equipment loans, and aircraft leases. Average Life. The average length of time that an issue of serial bonds and/or term bonds with a mandatory sinking fund feature is expected to be outstanding. Bankers' Acceptance (BA's). A draft or bill of exchange drawn upon and accepted by a bank. Frequently used to finance shipping of international goods. Used as a short-term credit instrument, bankers' acceptances are traded at a discount from face value as a money market instrument in the secondary market on the basis of the credit quality of the guaranteeing bank. Basis Point. One hundredth of one percent, or 0.01%. Thus 1% equals 100 basis points. Bearer Security. A security whose ownership is determined by the holder of the physical . security. Typically, there is no registration on the issuer's books. Title to bearer securities is transferred by delivery of the physical security or certificate.Also known as"physical securities." Benchmark Bills: In November 1999, FNMA introduced its Benchmark Bills program, a short- term debt securities issuance program to supplement its existing discount note program. The program includes a schedule of larger,weekly issues in three-and six-month maturities and biweekly issues in one-year for Benchmark Bills. Each issue is brought to market via a Dutch (single price) auction. FNMA conducts a weekly auction for each Benchmark Bill maturity and accepts both competitive and non-competitive bids through a web based auction system. This program is in addition to the variety of other discount note maturities, with rates posted on a daily basis,which FNMA offers. FNMA's Benchmark Bills are unsecured general obligations that are issued in book-entry form through the Federal Reserve Banks. There are no periodic payments of interest on.Benchmark Bills,which are sold at a discount from the principal amount and payable at par at maturity. Issues under the Benchmark program constitute the same credit standing as other FNMA discount notes;they simply add organization and liquidity to the short-term Agency discount note market. 1 • DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Benchmark Notes/Bonds: Benchmark Notes and Bonds are a series of FNMA"bullet"maturities (non-callable)issued according to a pre-announced calendar. Under its Benchmark Notes/Bonds program, 2, 3, 5, 10, and 30-year maturities are issued each quarter. Each Benchmark Notes new issue has a minimum size of $4 billion, 30-year new issues having a minimum size of $1 billion, with re-openings based on investor demand to further enhance liquidity.The amount of non-callable issuance has allowed FNMA to build a yield curve in Benchmark Notes and Bonds in maturities ranging from 2 to 30 years. The liquidity emanating from these large size issues has facilitated favorable financing opportunities through the development of a liquid overnight and term repo market. Issues under the Benchmark program constitute the same credit standing as other FNMA issues;they simply add organization and liquidity to the intermediate-and long-term Agency market. Benchmark. A market index used as a comparative basis for measuring the performance of an investment portfolio. A performance benchmark should represent a close correlation to investment guidelines, risk tolerance, and duration of the actual portfolio's investments. Bid Price. Price at which a broker/dealer offers to purchase a security from an investor. Bond. Financial obligation for which the issuer promises to pay the bondholder(the purchaser or owner of the bond) a specified stream of future cash-flows, including periodic interest payments and a principal repayment. Book Entry Securities. Securities that are recorded in a customer's account electronically through one of the financial markets electronic delivery and custody systems,such as the Fed Securities wire, DTC, and PTC (as opposed to bearer or physical securities). The trend is toward a certificate-free society in order to cut down on paperwork and to diminish investors' concerns about the . certificates themselves. The vast majority of securities are now book entry securities. Book Value. The value at which a debt security is reflected on the holder's records at any point in time. Book value is also called "amortized cost" as it represents the original cost of an investment adjusted for amortization of premium or accretion of discount. Also called "carrying value." Book value can vary over time as an investment approaches maturity and differs from "market value"in that it is not affected by changes in market interest rates. Broker/Dealer. A person or firm transacting securities business with customers.A"broker"acts as an agent between buyers and sellers and receives a commission for these services.A"dealer" buys and sells financial assets from its own portfolio. A dealer takes risk by owning inventory of securities, whereas a broker merely matches up buyers and sellers. See also "Primary Dealer." Bullet Notes/Bonds. Notes or bonds that have a single maturity date and are non-callable. Call Date. Date at which a call option may be or is exercised. Call Option. The right, but not the obligation, of an issuer of a security to redeem a 2 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • security at a specified value and at a specified date or dates prior to its stated maturity date. Most fixed-income calls are at par but can be at any previously established price. Securities issued with a call provision typically carry a higher yield than similar securities issued without a call feature. There are three primary types of call options (1) European -one-time calls, (2) Bermudan - periodically on a predetermined schedule (quarterly, semi-annual; annual), and (3)American-continuously callable at anytime on or after the call date.There is usually a notice period of at least 5 business days prior to a call date. Callable Bonds/Notes. Securities which contain an imbedded call option giving the issuer the right to redeem the securities prior to maturity at a predetermined price and time. Certificate of Deposit (CD). Bank obligation issued by a financial institution generally offering a fixed rate of return (coupon) for a specified period of time (maturity). Can be as long as 10 years to maturity, but most CDs purchased by public agencies are one year and under. Collateral. Investment securities or other property that a borrower pledges to secure repayment of a loan, secure deposits of public monies, or provide security fora repurchase agreement. Collateralization. Process by which a borrower pledges securities, property, or other deposits for securing the repayment of a loan and/or security. •Collateralized Mortgage Obligation (CMO). A security that pools together mortgages and separates them into short, medium, and long-term positions (called tranches). Tranches are set up to pay different rates of interest depending upon their maturity. Interest payments are usually paid monthly. In "plain vanilla" CMOs, principal is not paid on a tranche until all shorter tranches have been paid off. This system provides interest and principal in a more predictable manner.A single pool of mortgages can be carved up into numerous tranches each with its own payment and risk characteristics. Commercial Paper. Short term unsecured promissory note issued by a company or financial institution. Issued at a discount and matures for par or face value. Usually a maximum maturity of 270 days and given a short-term debt rating by one or more NRSROs. Convexity. A measure of a bond's price sensitivity to changing interest rates. A high convexity indicates greater sensitivity of a bond's price to interest rate changes. Corporate Note. A debt instrument issued by a corporation with a maturity of greater than one year-and less than ten years. Counterparty. The other party in a two-party financial transaction. "Counterparty risk" refers to the risk that the other party to a transaction will fail in its related obligations. For example, the bank or broker/dealer in a repurchase agreement. Coupon Rate. Annual rate of interest on a debt security, expressed as a percentage of the bond's face value. Current Yield. Annual rate of return on a bond based on its price. Calculated as 3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 (coupon rate/price) but does not accurately reflect a bond's true yield level. Custody. Safekeeping services offered by a bank, financial institution, or trust company, referred to as the "custodian." Service normally includes the holding and reporting of the customer's securities, the collection and disbursement of income, securities settlement, and market values. Dealer. A dealer,as opposed to a.broker,acts as a principal in all transactions,buying and selling for his/her own account. Delivery Versus Payment(DVP). Settlement procedure in which securities are delivered versus payment of cash, but only after cash has been received. Most security transactions, including those through the Fed Securities Wire system and DTC, are done DVP as a protection for both the buyer and seller of securities. Depository Trust Company (DTC). A firm through which members can use a computer to arrange for securities to be delivered to other members without physical delivery of certificates. A member of the Federal Reserve System and owned mostly by the New York Stock Exchange, the Depository Trust Company uses computerized debit and credit entries. Most corporate securities, commercial paper, CDs, and BAs clear through DTC. 'Derivatives. (1) Financial instruments whose return profile is linked to, or derived from, the movement of one or more underlying index or security, and may include a leveraging factor, or (2) financial contracts based upon notional amounts whose value is derived from an underlying index or security (interest rates, foreign exchange rates, equities, or commodities). For hedging purposes, common derivatives are options, futures, interest rate swaps, and swaptions. All Collateralized Mortgage Obligations (CMOs)are derivatives. Derivative Security. Financial instrument created from, or whose value depends upon, one or more underlying assets or indexes of asset values. Designated Bond. FFCB's regularly issued, liquid, non-callable securities that generally have a 2- or 3-year original maturity. New issues of Designated Bonds are $1 billion or larger. Re- openings of existing Designated Bond issues are generally a minimum of $100 million. Designated Bonds are offered through a syndicate of two to six dealers.Twice each month the Funding Corporation announces its intention to issue a new Designated Bond, reopen an existing issue, or to not issue or reopen a Designated Bond. Issues under the Designated Bond program constitute the same credit standing as other FFCB issues; they simply add organization and liquidity to the intermediate-and long-term Agency market. Discount Notes. Unsecured general obligations issued by Federal Agencies at a discount. Discount notes mature at par and can range in maturity from overnight to one year. Very large primary View issue) and secondary markets exist. Discount Rate. Rate charged by the system of Federal Reserve Banks on overnight loans to member banks. Changes to this rate are administered by the Federal Reserve and closely mirror changes to the"fed funds rate." 4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Discount Securities. Non-interest-bearing money market instruments that are issued at discount and redeemed at maturity for full face value. Examples include: U.S. Treasury Bills, Federal Agency Discount Notes, Bankers' Acceptances, and Commercial Paper. Discount. The amount by which a bond or other financial instrument sells below its face value. See also "Premium." Diversification. Dividing investment funds among a variety of security types, maturities, industries, and issuers offering potentially independent returns. Dollar Price. A bond's cost expressed as a percentage of its face value. For example, a bond quoted at a dollar price of 95 1/2, would have a principal cost of $955 per$1,000 of face value. Duff& Phelps. One of several NRSROs that provide credit ratings on corporate and bank debt issues. Duration. The weighted average. maturity of a security's or portfolio's cash-flows,where the present values of the cash-flows serve as the weights. The greater the duration of a security/portfolio, the greater its percentage price volatility with respect to changes in interest rates. Used as a measure of risk and a key tool for managing a portfolio versus a benchmark and for hedging risk. There are also different kinds of duration used for different purposes (e.g. MacAuley Duration, Modified Duration). Fannie Mae. See "Federal National Mortgage Association." Fed Money Wire. A computerized communications system that connects the Federal Reserve System with its member banks,certain U.S.Treasury offices,and the Washington D.C. office of the Commodity Credit Corporation.The Fed Money Wire is the book entry system used to transfer cash balances between banks for themselves and for customer accounts. Fed Securities Wire. A computerized communications system that facilitates book entry transfer of securities between banks, brokers and customer accounts, used primarily for settlement of U.S.Treasury and Federal Agency securities. Fed. See "Federal Reserve System." Federal Agency Security. A debt instrument issued by one of the Federal Agencies. Federal Agencies are considered second in credit quality and liquidity only to U.S.Treasuries. Federal Agency. Government sponsored/owned entity created by the U.S. Congress, generally for the purpose of acting as a financial intermediary by borrowing in the marketplace and directing proceeds to specific areas of the economy considered to otherwise have restricted access to credit markets. The largest Federal Agencies are GNMA, FNMA, FHLMC, FHLB, FFCB, SLMA, and TVA. Federal Deposit Insurance Corporation (FDIC). Federal agency that insures deposits at commercial banks, currently to a limit of$250,000 per depositor per bank. 5 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • Federal Farm Credit Bank(FFCB). One of the large Federal Agencies. A government sponsored enterprise (GSE) system that is a network of cooperatively-owned lending institutions that provides credit services to farmers,agricultural cooperatives and rural utilities.The FFCBs act as financial intermediaries that borrow money in the capital markets and use the proceeds to make loans and provide other assistance to farmers and farm-affiliated businesses. Consists of the consolidated operations of the Banks for Cooperatives, Federal Intermediate Credit Banks, and Federal Land Banks. Frequent issuer of discount notes, agency notes and callable agency securities. FFCB debt is not an obligation of, nor is it guaranteed by the U.S. government, although it is considered to have minimal credit risk due to its importance to the U.S. financial system and agricultural industry.Also, issues notes under its"designated note" program. Federal Funds (Fed Funds). Funds placed in Federal Reserve Banks by depository institutions in excess of current reserve requirements, and frequently loaned or borrowed on an overnight basis between depository institutions. Federal Funds Rate (Fed Funds Rate). The interest rate charged by a depository institution lending Federal Funds to another depository institution. The Federal Reserve influences this rate by establishing a "target" Fed Funds rate associated with the Fed's management of monetary policy. ;Federal Home Loan Bank System (FHLB). One of the large Federal Agencies. A government sponsored .enterprise (GSE) system, consisting of wholesale banks (currently twelve district • banks) owned by their member banks, which provides correspondent banking services and credit to various financial institutions, financed by the issuance of securities. The principal purpose of the FHLB is to add liquidity to the mortgage markets. Although FHLB does not directly fund mortgages; it provides a stable supply of credit to thrift institutions that make new mortgage loans. FHLB debt is not an obligation of, nor is it guaranteed by the U.S. government, although it is considered to have minimal credit risk due to its importance to the U.S. financial system and housing market.Frequent issuer of discount notes,agency notes and callable agency securities. Also issues notes under its "global note" and "TAP" programs. Federal Home Loan Mortgage Corporation (FHLMC or "Freddie Mac"). One of the large Federal Agencies. A government sponsored public corporation (GSE) that provides stability and assistance to the secondary market for home mortgages by purchasing first mortgages and participation interests financed by the sale of debt and guaranteed mortgage backed securities. FHLMC debt is not an obligation of, nor is it guaranteed by the U.S. government, although it is considered to have minimal credit risk due to its importance to the U.S. financial system and housing market. Frequent issuer of discount notes, agency notes, callable agency securities, and MBS. Also, issues notes under its "reference note" program. Federal National Mortgage Association (FNMA or "Fannie Mae"). One of the large Federal Agencies. A government sponsored public corporation (GSE) that provides liquidity to the residential mortgage market by purchasing mortgage loans from lenders, financed by the issuance of debt securities and MBS (pools of mortgages packaged together as a security). FNMA debt is not an obligation of, nor is it guaranteed by the U.S. government, although it is considered to have minimal credit risk due to its importance to the U.S. financial system and 6 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 housing market. Frequent issuer of discount notes, agency notes, callable agency securities and MBS.Also, issues notes under its "benchmark note" program. Federal Reserve Bank. One of the 12 distinct banks of the Federal Reserve System. Federal Reserve System (the Fed). The independent central bank system of the United States that establishes and conducts the nation's monetary policy.This is accomplished in three major ways: (1) raising or lowering bank reserve requirements, (2)•raising or lowering the target Fed Funds Rate and Discount Rate, and (3) in open market operations by buying and selling government securities.The Federal Reserve System is made up of twelve Federal Reserve District Banks, their branches, and many national and state banks throughout the nation. It is headed by the seven-member Board of Governors known as the "Federal Reserve Board" and headed by its Chairman. Financial Industry Regulatory Authority, Inc. (FINRA). A private corporation that acts as a self-regulatory organization (SRO). FINRA is the successor to the National Association of Securities Dealers, Inc. (NASD). Though sometimes mistaken for a government agency, it is a non-governmental organization that performs financial regulation of member brokerage firms and exchange markets. The government also has a regulatory arm for investments, the Securities and Exchange Commission (SEC). Fiscal Agent/Paying Agent. A bank or trust company that acts, under a trust agreement with a corporation or municipality, in the capacity of general treasurer. The agent performs such duties as making coupon payments, paying rents,redeeming bonds, and handling taxes relating to the issuance of bonds. Fitch Investors Service, Inc. One of several NRSROs that provide credit ratings on corporate and municipal debt issues. Floating Rate Security (FRN or "floater"). A bond with an interest rate that is adjusted according to changes in an interest rate or index. Differs from variable- rate debt in that the changes to the rate take place immediately when the index changes, rather than on a predetermined schedule. See also "Variable Rate Security." Freddie Mac. See "Federal Home Loan Mortgage Corporation." Ginnie Mae. See "Government National Mortgage Association." Global Notes: Notes designed to qualify for immediate trading in both the domestic U.S.capital market and in foreign markets around the globe. Usually large issues that are sold to investors worldwide and therefore have excellent liquidity. Despite their global sales,global notes sold in the U.S. are typically denominated in U.S. dollars. Government National Mortgage Association (GNMA or "Ginnie Mae"). One of the large Federal Agencies. Government-owned Federal Agency that acquires, packages, and resells mortgages and mortgage purchase commitments in the form of mortgage-backed securities. Largest issuer of mortgage pass-through securities. GNMA debt is guaranteed by the full faith 7 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 and credit of the U.S.government(one of the few agencies that are actually full faith and credit of the U.S. government). Government Securities. An obligation of the U.S. government backed by the full faith and credit of the government. These securities are regarded as the highest quality of investment securities available in the U.S. securities market.See "Treasury Bills, Notes, Bonds, and SLGS." • DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 Government Sponsored Enterprise (GSE). Privately owned entity subject to federal regulation and supervision,created by the U.S.Congress to reduce the cost of capital for certain borrowing sectors of the economy such as students, farmers, and homeowners. GSEs carry the implicit backing of the U.S. government, but they are not direct obligations of the U.S. government. For this reason, these securities will offer a yield premium over U.S. Treasuries. Examples of GSEs include: FHLB, FHLMC, FNMA, and SLMA. Government Sponsored Enterprise Security. A security issued by a Government Sponsored Enterprise. Considered Federal Agency Securities. Index. A compilation of statistical data that tracks changes in the economy or in financial markets. Interest-Only (10) STRIP. A security based solely on the interest payments from the bond. After the principal has been repaid, interest payments stop and the value of the security falls to nothing. Therefore, lOs are considered risky investments. Usually associated with mortgage-backed securities. Internal Controls. An internal control structure ensures that the assets of the entity are protected from loss, theft, or misuse. The internal control structure is designed to provide reasonable assurance that these objectives are met. The concept of reasonable assurance recognizes that 1)the cost of a control should not exceed the benefits likely to be derived and 2) the valuation of costs and benefits requires estimates and judgments by management. Internal controls should address the following points: 1. Control of collusion - Collusion is a situation where two or more employees are working in ' conjunction to defraud their employer. • 2. Separation of transaction authority from accounting and record keeping - A separation of duties is'achieved by separating the person who authorizes or performs the transaction from the people who record or otherwise account for the transaction. 3. Custodial safekeeping - Securities purchased from any bank or dealer including appropriate collateral (as defined by state law)shall be placed with an independent third party for custodial safekeeping. 4. Avoidance of physical delivery securities-Book-entry securities are much easier to transfer and account for .since actual delivery of a document never takes place. Delivered securities must be properly safeguarded against loss or destruction. The potential for fraud and loss increases with physically delivered securities. 5.Clear delegation of authority to subordinate staff members -Subordinate staff members must have a clear understanding of their authority and responsibilities to avoid improper actions. Clear delegation of authority also preserves the internal control structure that is contingent on the various staff positions and their respective responsibilities. 9 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 6. Written confirmation of transactions for investments and wire transfers - Due to the potential for error and improprieties arising from telephone and electronic transactions, all transactions should be supported by written communications and approved by the appropriate person. Written communications may be via fax if on letterhead and if the safekeeping institution has a list of authorized signatures. 7. Development of a wire transfer agreement with the lead bank and third-party custodian - The designated official should ensure that an agreement will be entered into and will address the following points:controls, security provisions,and responsibilities of each party making and receiving wire transfers. Inverse Floater. A floating rate security structured in such a way that it reacts inversely to the direction of interest rates. Considered risky as their value moves in the opposite direction of normal fixed-income investments and whose interest rate can fall to zero. Investment Advisor. A company that provides professional advice managing portfolios, investment recommendations, and/or research in exchange for a management fee. Investment Adviser Act of 1940. Federal legislation that sets the standards by which investment companies, such as mutual funds, are regulated in the areas of advertising, promotion, performance reporting requirements, and securities valuations. Investment Grade. Bonds considered suitable for preservation of invested capital, including bonds rated a minimum of Baa3 by Moody's, BBB- by Standard & Poor's, or BBB- by Fitch. Although "BBB" rated bonds are considered investment grade, most public agencies cannot invest in securities rated below "A." Liquidity. Relative ease of converting an asset into cash without significant loss of value. Also, a relative measure of cash and near-cash items in a portfolio of assets. Additionally, it is a term describing the marketability of a money market security correlating to the narrowness of the spread between the bid and ask prices. Local Government Investment Pool (LGIP). An investment by local governments in which their money is pooled as a method for managing local funds, (e.g., Florida State Board of Administration's Florida Prime Fund). Long-Term Core Investment Program. Funds that are not needed within a one-year period. Market Value. The fair market value of a security or commodity. The price at which a willing buyer and seller would pay for a security. Mark-to-market. Adjusting the value of an asset to its market value, reflecting in the process unrealized gains or losses. Master Repurchase Agreement. A widely accepted standard agreement form published by the Securities Industry and Financial Markets Association (SIFMA) that is used to govern and document Repurchase Agreements and protect the interest of parties in a repo transaction. Maturity Date. Date on which principal payment of a financial obligation is to be paid. 10 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 Medium Term Notes (MTV's). Used frequently to refer to corporate notes of medium maturity(5-years and under).Technically, any debt security issued by a corporate or depository institution with a maturity from 1 to 10 years and issued under an MTN shelf registration. Usually issued in smaller issues with varying coupons and maturities and underwritten by a variety of broker/dealers (as opposed to large corporate deals issued and underwritten all at once in large size and with a fixed coupon and maturity). Money Market. The market in which short-term debt instruments (bills, commercial paper, bankers' acceptance, etc.) are issued and traded. Money Market Mutual Fund(MMF). A type of mutual fund that invests solely in money market instruments, such as: U.S. Treasury bills, commercial paper, bankers' acceptances, and repurchase agreements. Money market mutual funds are registered with the SEC under the Investment Company Act of 1940 and are subject to "rule 2a-7" which significantly limits average maturity and credit quality of holdings. MMF's are managed to maintain a stable net asset value (NAV) of $1.00. Many MMFs carry ratings by a NRSRO. Moody's Investors Service. One of several NRSROs that provide credit ratings on corporate and municipal debt issues. Mortgage Backed Securities (MBS). Mortgage-backed securities represent an ownership interest in a pool of mortgage loans made by financial institutions, such as savings and loans, commercial banks, or mortgage companies, to finance the borrower's purchase of a home or other real estate.The majority of MBS are issued and/or guaranteed by GNMA, FNMA, and FHLMC.There are a variety of MBS structures with varying levels of risk and complexity. All MBS have reinvestment risk as actual principal and interest payments are dependent on the payment of the underlying mortgages which can be prepaid by mortgage holders to refinance and lower rates or simply because the underlying property was sold. Mortgage Pass-Through Securities. A pool of residential mortgage loans with the monthly interest and principal distributed to investors on a pro-rata basis.The largest issuer is GNMA. Municipal Note/Bond. A debt instrument issued by a state or local government unit or public agency.The vast majority of municipals are exempt from state and federal income tax,although some non-qualified issues are taxable. Mutual Fund. Portfolio of securities professionally managed by a registered investment company that issues shares to investors. Many different types of mutual funds exist (e.g., bond, equity, and money market funds); all except money market funds operate on a variable net asset value (NAV). Negotiable Certificate of Deposit (Negotiable CD). Large denomination CDs ($100,000 and larger) that are issued in bearer form and can be traded in the secondary market. Net Asset Value. The market value of one share of an investment company, such as a mutual fund. This figure is calculated by totaling a fund's assets including securities, cash, and any accrued earnings, then subtracting the total assets from the fund's liabilities, and dividing 11 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 this total by the number of shares outstanding.This is calculated once a day based on the closing price for each security in the fund's portfolio. (See below.) [(Total assets)- (Liabilities)]/(Number of shares outstanding) NRSRO. A "Nationally Recognized Statistical Rating Organization" (NRSRO) is a designated rating organization that the SEC has deemed a strong national presence in the U.S. NRSROs provide credit ratings on corporate and bank debt issues. Only ratings of a NRSRO maybe used • for the regulatory purposes of rating. Includes Moody's,S&P, Fitch, and Duff& Phelps. Offered Price. See also "Ask Price." Open Market Operations. A Federal Reserve monetary policy tactic entailing the purchase or sale of government securities in the open market by the Federal Reserve System from and to primary dealers in order to influence the money supply, credit conditions, and interest rates. Par Value. The face value, stated value, or maturity value of a security. Physical Delivery. Delivery of readily available underlying assets at contract maturity. Portfolio. Collection of securities and investments held by an investor. Premium. The amount by which a bond or other financial instrument sells above its face value. See also "Discount." Primary Dealer. A designation given to certain government securities dealer by the Federal Reserve Bank of New York. Primary dealers can buy and sell government securities directly with the Fed. Primary dealers also submit daily reports of market activity and security positions held to the Fed and are subject to its informal oversight. Primary dealers are the largest buyers and sellers by volume in the U.S.Treasury securities market. Prime Paper. Commercial paper of high quality. Highest rated paper is.A-1+/A-1 by S&P and P- 1 by Moody's. Principal. Face value of a financial instrument on which interest accrues. May be less than par value if some principal has been repaid or retired. For a transaction, principal is par value times price and includes any premium or discount. Prudent Expert Rule. Standard that requires that a fiduciary manage a portfolio with the care, skill, prudence,and diligence, under the circumstances then prevailing, that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims. This statement differs from the "prudent person" rule in that familiarity with such matters suggests a higher standard than simple prudence. Prudent Investor Standard. Standard that requires that when investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence,and diligence under the circumstances then prevailing, including, but not limited to,the general economic conditions and the anticipated needs of the agency,that a prudent person acting in a like capacity and familiarity with those matters would use in the 12 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 conduct of funds of a like character and with like aims,to safeguard the principal and maintain the liquidity needs of the agency. More stringent than the "prudent person" standard as it implies a level of knowledge commensurate with the responsibility at hand. Qualified Public Depository - Per Subsection 280.02(26), F.S., "qualified public depository" means any bank,savings bank, or savings association that: 1. Is organized and exists under the laws of the United States, the laws of this state or any other state or territory of the United States. 2. Has its principal place of business in this state or has a branch office in this state which is authorized under the laws of this state or of the United States to receive deposits in this state. 3. Has deposit insurance under the provision of the Federal Deposit Insurance Act, as amended, 12 U.S.C. ss.1811 et seq. 4. Has procedures and practices for accurate identification, classification, reporting, and collateralization of public deposits. 5. Meets all requirements of Chapter 280, F.S. 6. Has been designated by the Chief Financial Officer as a qualified public depository. Range Note. A type of structured note that accrues interest daily at a set coupon rate that is tied to an index. Most range notes have two coupon levels; a higher accrual rate for the period the index is within a designated range, the lower accrual rate for the period that the index falls outside the designated range. This lower rate may be zero and may result in zero • earnings. Rate of Return. Amount of income received from an investment, expressed as a percentage . of the amount invested. Realized Gains (Losses). The difference between the sale price of an investment and its book value.Gains/losses are "realized"when the security is actually sold,as compared to"unrealized" gains/losses which are based on current market value.See "Unrealized Gains (Losses)." Reference Bills: FHLMC's short-term debt program created to supplement its existing discount note program by offering issues from one month through one year, auctioned on a weekly or on an alternating four-week basis (depending upon maturity) offered in siieable volumes($1 billion and up)on a cycle of regular,standardized issuance. Globally sponsored and distributed, Reference Bill issues are intended to encourage active trading and market-making and facilitate the development of a term repo market. The program was designed to offer predictable supply, pricing transparency, and liquidity, thereby providing alternatives to U.S. Treasury bills. FHLMC's Reference Bills are unsecured general corporate obligations. This program supplements the corporation's existing discount note program. Issues under the Reference program constitute the same credit standing as other FHLMC discount notes; they simply add organization and liquidity to the short-term Agency discount note market. 13 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Reference Notes: FHLMC's intermediate-term debt program with issuances of 2, 3, 5, 10, and 30-year maturities. Initial issuances range from $2 - $6 billion with re- openings ranging$1-$4 billion. The notes are high-quality bullet structures securities that pay interest semiannually. Issues • under the Reference program constitute the same credit standing as other FHLMC notes;they simply add organization and liquidity to the intermediate-and long-term Agency market. Repurchase Agreement(Repo). A short-term investment vehicle where an investor agrees to buy securities from a counterparty and simultaneously agrees to resell the securities back to the counterparty at an agreed upon time and for an agreed upon price.The difference between the purchase price and the sale price represents interest earned on the agreement. In effect, it represents a collateralized loan to the investor, where the securities are the collateral can be DVP, where securities are delivered to the investor's custodial bank, or "tri-party" where the securities are delivered to a third-party intermediary. Any type of security can be used as "collateral," but only some types provide the investor with special bankruptcy protection under the law. Repos should be undertaken only when an appropriate BMA approved master repurchase agreement is in place. Reverse Repurchase Agreement (Reverse Repo). A repo from the point of view of the original seller of securities. Used by dealers to finance their inventory of securities by essentially borrowing at short-term rates. Can also be used to leverage a portfolio and in this sense, can be considered risky if used improperly. Safekeeping. Service offered for a fee, usually by financial institutions, for the holding of securities and other valuables. Safekeeping is a component of custody services. Secondary Market. Markets for the purchase and sale of any previously issued financial instrument. Securities Industry and Financial Markets Association (SIFMA). The bond market trade association representing the largest securities markets in the world. In addition to publishing a Master Repurchase Agreement, widely accepted as the industry standard document for Repurchase Agreements, the SIFMA also recommends bond market closures and early closes due to holidays. Securities Lending. An arrangement between and investor and a custody bank that allows the custody bank to "loan" the investors investment holdings, reinvest the proceeds in permitted investments, and shares any profits with the investor. Should be governed by a securities lending agreement. Can increase the risk of a portfolio in that the investor takes on the default • risk on the reinvestment at the discretion of the custodian. Sinking Fund. A separate accumulation of cash or investments (including earnings on investments) in a fund in accordance with the terms of a trust agreement or indenture,funded by periodic deposits by the issuer(or other entity responsible for debt service),for the purpose of assuring timely availability of moneys for payment of debt service. Usually used in connection with term bonds. 14 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • • Spread. The difference between the price of a security and similar maturity U.S. Treasury investments, expressed in percentage terms or basis points.A spread can also be the absolute difference in yield between two securities. The securities can be in different markets or within the same securities market between different credits, sectors, or other relevant factors. Standard & Poor's. One of several NRSROs that provide credit ratings on corporate and municipal debt issues. STRIPS(Separate Trading of Registered Interest and Principal of Securities). Acronym applied to U.S.Treasury securities that have had their coupons and principal repayments separated into individual zero-coupon Treasury securities.The same technique and "strips" description can be applied to non-Treasury securities(e.g., FNMA strips). Structured Notes. Notes that have imbedded into their structure options such as step-up coupons or derivative-based returns. Swap. Trading one asset for another. TAP Notes: Federal Agency notes issued under the FHLB TAP program. Launched in 6/99 as a refinement to the FHLB bullet bond auction process. In a break from the FHLB's traditional practice of bringing numerous small issues to market with similar maturities, the TAP Issue Program uses the four most common maturities and reopens them up regularly through a competitive auction.These maturities(2,3,5,and 10 year)will remain open for the calendar quarter, after which they will be closed and a new series of TAP issues will be opened to replace them. This reduces the number of separate bullet bonds issued but generates enhanced awareness and liquidity in the marketplace through increased issue size and secondary market volume. Tennessee Valley Authority (TVA). One of the large Federal Agencies. A wholly owned corporation of the United States government that was established in 1933 to develop the resources of the Tennessee Valley region in order to strengthen the regional and national economy and the national defense. Power operations are separated from non-power operations. TVA securities represent obligations of TVA, payable solely from TVA's net power proceeds, and are neither obligations of nor guaranteed by the United States. TVA Is currently authorized to issue debt up to $30 billion. Under this authorization, TVA may also obtain advances from the U.S.Treasury of up to$150 million. Frequent issuer of discount notes,agency notes, and callable agency securities. Total Return. Investment performance measured over a period of time that includes coupon interest, interest on interest, and both realized and unrealized gains or losses. Total return includes, therefore, any market value appreciation/depreciation on investments held at period end. 15 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Treasuries. Collective term used to describe debt instruments backed by the U.S. government and issued through the U.S. Department of the Treasury. Includes Treasury bills, Treasury notes, and Treasury bonds. Also, a benchmark term used as a basis by which the yields of non-Treasury securities are compared (e.g., "trading at 50 basis points over Treasuries"). Treasury Bills (T-Bills). Short-term direct obligations of-the United States government issued with an original term of one year or less. Treasury bills are sold at a discount from face value and do not pay interest before maturity. The difference between the purchase price of the bill and the maturity value is the interest earned on the bill.Currently,the U.S.Treasury issues 4-week, 13-week, and 26-week T-Bills. Treasury Bonds. Long-term interest-bearing debt securities backed by the U.S.government and issued with maturities of ten years and longer by the U.S. Department of the Treasury. The Treasury stopped issuing Treasury Bonds in August 2001. Treasury Notes. Intermediate interest-bearing debt securities backed by the U.S. government and issued with maturities ranging from one to ten years by the U.S. Department of the Treasury.The Treasury currently issues 2-year, 5-year, and 10-year Treasury Notes. Trustee. A bank designated by an issuer of securities as the custodian of funds and official representative of bondholders. Trustees are appointed to insure compliance with the bond documents and to represent bondholders in enforcing their contract with the issuer. Uniform Net Capital Rule. SEC Rule 15c3-1 that outlines the minimum net capital ratio (ratio of indebtedness to net liquid capital) of member firms and non-member broker/dealers. Unrealized Gains(Losses). The difference between the market value of an investment and its book value. Gains/losses are "realized" when the security is actually sold, as compared to "unrealized" gains/losses which are based on current market value. See also "Realized Gains (Losses)." Variable-Rate Security. A bond that bears interest at a rate that varies over time based on a specified schedule of adjustment(e.g.,daily,weekly,monthly,semi-annually,or annually).See also "Floating Rate Note." Weighted Average Maturity (or just "Average Maturity"). The average maturity of all securities and investments of a portfolio, determined by multiplying the par or principal value of each security or investment by its maturity (days or years), summing the products, and dividing the sum by the total principal value of the portfolio.A simple measure of risk of a fixed- income portfolio. Weighted Average Maturity to Call. The average maturity of all securities and investments of a portfolio, adjusted to substitute the first call date per security for maturity date for those securities with call provisions. Yield Curve. A graphic depiction of yields on like securities in relation to remaining maturities spread over a time line. The traditional yield curve depicts yields on U.S. Treasuries, although 16 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1A2C0 yield curves exist for Federal Agencies and various credit quality corporates as well. Yield curves can be positively sloped (normal)where longer-term investments have higher yields,or "inverted" (uncommon)where longer-term investments have lower yields than shorter ones. Yield to Call (YTC). Same as "Yield to Maturity," except the return is measured to the first call date rather than the maturity date. Yield to call can be significantly higher or lower than a security's yield to maturity. Yield to Maturity (YTM). Calculated return on an investment, assuming all cash-flows from the security are reinvested at the same original yield. Can be higher or lower than the coupon rate depending on market rates and whether the security was purchased at a premium or discount. There are different conventions for calculating YTM for various types of securities. Yield. There are numerous methods of yield determination. In this glossary, see also "Current Yield," "Yield Curve," "Yield to Call," and "Yield to Maturity." 17 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 MPROCUREMENT DEPARTMENT I A M I B E AC H 1755 Meridian Avenue,3rd Floor Miami Beach,Florida 33139 www.miamibeachfl.gov ADDENDUM NO. 1 REQUEST FOR QUALIFICATIONS(RFQ)2021-264-KB INVESTMENT ADVISORY SERVICES November 5,2021' This Addendum to the above-referenced RFQ is issued in response to questions from prospective proposers, or other clarifications and revisions issued by the City. The RFQ is amended in the following particulars only (deletions are shown by strikethrough and additions are underlined). A SUBSEQUENT ADDENDUM WILL CONTAIN RESPONSES TO QUESTIONS RECEIVED. I. REVISION: RFQ DUE DATE AND TIME. The deadline for the electronic receipt of bids is extended until 3:00 p.m.,on Wednesday,September 22,2021. Proposals must be submitted electronically through Periscope S2G (formerly BidSync) on or before the date and time indicated. Hard copy proposals or proposals received through email or facsimile are not acceptable and will be rejected. A proposer may submit a modified proposal to replace all or any portion of a previously submitted proposal until the deadline for proposal submittals.The City will only consider the latest version of the bid. Electronic proposal submissions may require the uploading of attachments. All documents should be attached as separate files in accordance with the instructions included in Section 0300, Proposal Submittal Instructions and Format. Attachments containing embedded documents or proprietary file extensions are prohibited. It is the Bidders responsibility to assure that its bid, including all attachments, is uploaded successfully. Only proposal submittals received, and time stamped by Periscope S2G (formerly BidSync) prior to the proposal submittal deadline shall be accepted as timely submitted. Late bids cannot be submitted and will not be accepted. Bidders are cautioned to allow sufficient time for the submittal of bids and uploading of attachments. Any technical issues must be submitted to Periscope S2G (formerly BidSync) by contacting (800) 990-9339 (toll free) or S2G(a)periscopeholdings.com. The City cannot assist with technical issues regarding submittals and will in no way be responsible for delays caused by any technical or other issue. It is the sole responsibility of each Bidder to ensure its proposal is successfully submitted in BidSync prior to the deadline for proposal submittals. Any questions regarding this Addendum should be submitted in writing to the Procurement Department to the attention of the individual named below, with a copy to the City Clerk's Office at RafaelGranado@miamibeachfl.gov • Contact: Telephone: Email: Kristy Bada 305-673-7000 ext.7490 kristybada@miamibeachfl.gov Proposers are reminded to acknowledge receipt of this addendum as part of your RFQ submission. /Alenis ocurement Director 1 ADDENDUM NO.1 REQUEST FOR QUALIFICATIONS(RFQ)2021-264-KB INVESTMENT ADVISORY SERVICES DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 MIAMI BEACH Request for Qualifications (RFQ) 2021-264-KB Investment Advisory Services TABLE OF CONTENTS SOLICITATION SECTIONS: 0100 INSTRUCTIONS TO RESPONDENTS 0200 GENERAL CONDITIONS 0300 PROPOSAL SUBMITTAL INSTRUCTIONS &FORMAT 0400 PROPOSAL EVALUATION APPENDICES: APPENDIX A SPECIAL CONDITIONS DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 MIAMI BEACH SECTION 0100 INSTRUCTIONS TO RESPONDENTS&GENERAL CONDITIONS 1.GENERAL.This Request for Qualifications(RFQ) is issued by the City of Miami Beach, Florida(the"City"), as the means for prospective Proposers to submit proposals for the City's consideration in evaluating qualifications to select a firm with whom it may negotiate an agreement for the purpose noted herein. The City utilizes Periscope S2G(formally known as BidSync) (www.periscopeholdings.com or www.bidsvnc.com)for automatic notification of competitive solicitation opportunities and document fulfillment, including the issuance of any addendum to this RFQ. Any prospective Proposer who has received this RFQ by any means other than through Periscope S2G must register immediately with Periscope S2G to assure it receives any addendum issued to this RFQ. Failure to receive an addendum may result in disqualification of proposal submitted. 2. PURPOSE. On September 4, 2015 the City of Miami Beach ("City") executed a three (3) year agreement for the investment advisory services with Public Trust Advisors, LLC. with an expiration date of September 3, 2020. Since the City had exhausted the renewal options, on July 29, 2020 the Commission authorized the extension of the agreement for a period of one (1) year due to the financial impact that resulted from COVID19. Therefore, through this RFQ, the City is seeking proposals from firms qualified to provide the required scope of services detailed herein. The intent of the RFQ is to identify one or more firm(s)with whom the City may conduct competitive negotiations for the required services. The selection of firm(s) with whom the City may enter into negotiations shall be based on qualifications, in accordance with the criteria established herein. Cost of services will be considered only during the negotiation phase. Through this RFQ, the City of Miami Beach, Florida (the"City")seeks proposals from parties interested in providing the City with non-discretionary investment advisory services to make recommendations for the city's investments and direct the City's investments as further detailed herein. The successful firm would recommend the investment of excess funds in accordance with the City's investment objectives as set forth in City of Miami Beach's Investment Policy. The key objectives of the City's investment policy are safety of capital, sufficient liquidity to meet requirements and attaining market—average rates of return. Excess funds are defined as funds not required to meeting short term expenditures of the City. The City expects its investment advisor to be highly experienced with non-discretionary funds a leader and innovator in the management of investments, and able to provide comprehensive investment advisory services. The firm selected as the investment advisor and its affiliates will be restricted from selling to the City, or buying from the City, any securities to or from that firm's own inventory or account. The investment advisor will also be restricted from placing into the City's portfolio any securities for which it, or an affiliate, is the issuer. Investment advisors will not provide custodial services or security safekeeping. All City investments, except for swap agreements must be held in an independent custodial account. Fees for investment advisory services will be paid from additional investment earnings. Maturity and Liquidity Requirements The City selects investments whose terms compliment the need to make the majority expenditures set forth below. 1. Biweekly Payrolls 2. Periodic Debt Service Payments 3. Capital Project Needs For each expenditure event, investments are selected whose maturities occur at a date close to the date that funds will be needed. Investments also are selected based on the highest yield for the particular type of investment. In the case of capital projects, in which the exact date that expenditures will need to be made is unknown, the City selects DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 MIAMI BEACH several investments with varying maturities so that monies are available each month to cover all capital expenditures. Any unused capital investment funds are then placed in investments of one year or more to maximize return potential. 3. STATEMENT OF WORK REQUIRED. The City requires that the selected provider, at a minimum, provide the following services: 1. The City expects its investment advisor to be highly experienced, a leader and innovator in the management of investments, and able to provide comprehensive investment advisory services. The firm selected as the investment advisor and its affiliates will be restricted from selling to the City, or buying from the City, any securities to or from that firm's own inventory or account. 2. The investment advisor will also be restricted from placing into the City's portfolio any securities for which it, or an affiliate, is the issuer. Investment advisors will not provide custodial services or security safekeeping. 3. All City investments, except for swap agreements must be held in an independent custodial account. 4. Provide full-time management on a daily basis of the City's investment portfolio pursuant to the specific stated investment objectives and the City's Investment Policy. 5. Place all orders for the purchase and sale of securities, communicate settlement information to City staff and assist in coordinating security settlement. 6. Serve as a general resource to City staff for information, advice and training regarding fixed income securities, investment and yield curve analysis. 7. Work with City staff to develop cash flow projections to ensure that the investment strategy is consistent with the City's cash requirements. 8. Provide online real-time access to the City's portfolio that includes, at a minimum,the following information: a. monthly statements detailing investment activity and earnings, b. the value of the investment portfolio, c. portfolio return and monthly mark to market valuation d. weighted average maturity e. accrued interest by investment type f. rating of investment by Standards&Poor's and Moody's. 9. The selected investment advisor must maintain accurate reports including portfolio composition showing diversity of investments and compliance with applicable investment policies of the City of Miami Beach and State of Florida Statutes. 10. Develop and implement investment strategies for the Advisory Account that will seek to enhance portfolio performance under current and future market conditions within the parameters of the City's investment policy and cash flow needs. 11. Obtain and document competitive prices for securities transactions. 12. Provide semi-annual and annual portfolio performance reports. 13. Review and update the City's investment policy and written investment procedures. 14. Coordinate and pay any fees associated with rating agencies for the annual rating review and certification of the City's investment policy. 15. Perform due diligence reviews of current and proposed broker/dealers. 16. Monitor the creditworthiness of the City's depository and custodian bank and investments in the portfolio. 17. Provide training on investment management subjects and guarantee minimum 8hrs of CPE in person or virtual training, at the sole discretion of the City, in accordance with Florida Statue 218.415. 18. Provide, real-time access to the City's portfolio via an Online Web Based Reporting System accessible by the City. 19. Attend meetings with the City's finance staff and governing body upon request; and 20. Facilitate and fund arbitrage calculations and reports on the investment of bond proceeds. • DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 MIAMI BEACH 4.ANTICIPATED RFQ TIMETABLE.The tentative schedule for this solicitation is as follows: RFQ Issued July 30, 2021 Pre-Proposal Meeting August 20, 2021 at 10:00am EST To join on your computer or mobile app Click here to join the meeting Or call in (audio only) (1) Dial the TELEPHONE NUMBER: 1 786-636-1480 (Toll-free North America) (2)Enter the MEETING NUMBER 649 824 467# Deadline for Receipt of Questions September 3, 2021 at 5:00pm EST Responses Due September 13, 2021 at 3:00pm EST To join on your computer or mobile app Click here to join the meeting Or call in (audio only) (1) Dial the TELEPHONE NUMBER: 1 786-636-1480 (Toll-free North America) (2)Enter the MEETING NUMBER 357 909 740# Evaluation Committee Review September 2021 Tentative Commission Approval October 2021 Contract Negotiations Following Commission Approval 5. PROCUREMENT CONTACT. Any questions or clarifications conceming this solicitation shall be submitted to the Procurement Contact noted below: Procurement Contact Telephone: Email: Krist Bada 305-673-7000 x6218 krist bada' miamibeachfl.•ov Additionally, the City Clerk is to be co•ied on all communications via e-mail at: RafaelGranado • miamibeachfl.•ov; or via facsimile: 786-394-4188. The Proposal title/number shall be referenced on all correspondence. All questions or requests for clarification must be received no later than ten (10)calendar days prior to the date proposals are due as scheduled in Section 0100-4. All responses to questions/clarifications will be sent to all prospective Proposers in the form of an addendum. 6. PRE-PROPOSAL MEETING OR SITE VISIT(S).Only if deemed necessary by the City, a pre-proposal meeting or site visit(s) may be scheduled.Attendance for the pre-proposal meeting shall be via telephone or web-conference and recommended as a source of information but is not mandatory. Bidders interested in participating in the Pre- Proposal Meeting must follow these steps: To join on your computer or mobile app Click here to join the meeting Or call in (audio only) (1)Dial the TELEPHONE NUMBER:1 786-636-1480(Toll-free North America) (2)Enter the MEETING NUMBER 649 824 467# Bidders who are participating via telephone should send an e-mail to the contact person listed in this RFP expressing their intent to participate via telephone. DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 MIAMI BEACH 7. PRE-PROPOSAL INTERPRETATIONS. Oral information or responses to questions received by prospective Proposers are not binding on the City and will be without legal effect, including any information received at pre- submittal meeting or site visit(s). The City by means of Addenda will issue interpretations or written addenda clarifications considered necessary by the City in response to questions. Only questions answered by written addenda will be binding and may supersede terms noted in this solicitation. Addendum will be released through Periscope S2G. Any prospective proposer who has received this RFQ by any means other than through Periscope S2G must register immediately with Periscope S2G to assure it receives any addendum issued to this RFQ. Failure to receive an addendum may result in disqualification of proposal.Written questions should be received no later than the date outlined in the Anticipated RFQ Timetable section. 8. CONE OF SILENCE. This RFQ is subject to, and all proposers are expected to be or become familiar with, the City's Cone of Silence Requirements, as codified in Section 2-486 of the City Code. Proposers shall be solely responsible for ensuring that all applicable provisions of the City's Cone of Silence are complied with, and shall be subject to any and all sanctions, as prescribed therein, including rendering their response voidable, in the event of such non-compliance. Communications regarding this solicitation are to be submitted in writing to the Procurement Contact named herein with a copy to the City Clerk at rafaelgranado@miamibeachfl.gov 9. ADDITIONAL INFORMATION OR CLARIFICATION. After proposal submittal, the City reserves the right to require additional information from Proposers (or Proposer team members or sub-consultants) to determine: qualifications(including, but not limited to, litigation history, regulatory action, or additional references); and financial capability(including, but not limited to, annual reviewed/audited financial statements with the auditors notes for each of their last two complete fiscal years). 10. PROPOSER'S RESPONSIBILITY. Before submitting a response, each Proposer shall be solely responsible for making any and all investigations, evaluations, and examinations, as it deems necessary, to ascertain all conditions and requirements affecting the full performance of the contract. Ignorance of such conditions and requirements, and/or failure to make such evaluations, investigations, and examinations, will not relieve the Proposer from any obligation to comply with every detail and with all provisions and requirements of the contract, and will not be accepted as a basis for any subsequent claim whatsoever for any monetary consideration on the part of the Proposer. 11. DETERMINATION OF AWARD. The City Manager may appoint an evaluation committee to assist in the evaluation of proposals received. The evaluation committee is advisory only to the city manager. The city manager may consider the information provided by the evaluation committee process and/or may utilize other information deemed relevant: The City Manager's recommendation need not be consistent with the information provided by the evaluation committee process and takes into consideration Miami Beach City Code Section 2-369, including the following considerations: (1)The ability, capacity and skill of the Proposer to perform the contract. (2)Whether the Proposer can perform the contract within the time specified,without delay or interference. (3)The character, integrity, reputation,judgment,experience and efficiency of the Proposer. (4)The quality of performance of previous contracts. (5)The previous and existing compliance by the Proposer with laws and ordinances relating to the contract. The City Manager may recommend to the City Commission the Proposer(s)s/he deems to be in the best interest of the City or may recommend rejection of all proposals. The City Commission shall consider the City Manager's recommendation and may approve such recommendation. The City Commission may also, at its option, reject the City Manager's recommendation and select another Proposal or Proposals which it deems to be in the best interest of the City, or it may also reject all Proposals. DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 MIAMI BEACH 12. NEGOTIATIONS. Following selection, the City reserves the right to enter into further negotiations with the selected Proposer. Notwithstanding the preceding, the City is in no way obligated to enter into a contract with the selected Proposer in the event the parties are unable to negotiate a contract. It is also understood and acknowledged by Proposers that no property, contract or legal rights of any kind shall be created at any time until and unless an Agreement has been agreed to; approved by the City; and executed by the parties. 13. E-VERIFY. As a contractor you are obligated to comply with the provisions of Section 448.095, Fla. Stat., "Employment Eligibility."Therefore, you shall utilize the U.S. Department of Homeland Security's E-Verify system to verify the employment eligibility of all new employees hired by the Contractor during the term of the Contract and shall expressly require any subcontractors performing work or providing services pursuant to the Contract to likewise utilize the U.S. Department of Homeland Security's E-Verify system to verify the employment eligibility of all new employees hired by the subcontractor during the Contract term. Balance of Page Intentionally Left Blank DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 MIAMI BEACH SECTION 0200 GENERAL CONDITIONS TERMS & CONDITIONS —SERVICES. By virtue of submitting a proposal in response to this solicitation, proposer agrees to be bound by and in compliance with the Terms and Conditions for Services (dated April 3, 2020), incorporated herein,which may be found at the following link: https://www.miamibeachfl.gov/city-hall/procurement/standard-terms-and-conditions/ Balance of Page Intentionally Left Blank DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 MIAMI BEACH SECTION 0300 PROPOSAL SUBMITTAL INSTRUCTIONS AND FORMAT 1. ELECTRONIC RESPONSES (ONLY). Proposals must be submitted electronically through Periscope S2G (formerly BidSync) on or before the date and time indicated. Hard copy proposals or proposals received through email or facsimile are not acceptable and will be rejected. A proposer may submit a modified proposal to replace all or any portion of a previously submitted proposal until the deadline for proposal submittals.The City will only consider the latest version of the bid. Electronic proposal submissions may require the uploading of attachments. All documents should be attached as separate files in accordance with the instructions included in Section 4, below. Attachments containing embedded documents or proprietary file extensions are prohibited. It is the Bidders responsibility to assure that its bid, including all attachments, is uploaded successfully. Only proposal submittals received, and time stamped by Periscope S2G (formerly BidSync) prior to the proposal submittal deadline shall be accepted as timely submitted. Late bids cannot be submitted and will not be accepted. Bidders are cautioned to allow sufficient time for the submittal of bids and uploading of attachments. Any technical issues must be submitted to Periscope S2G (formerly BidSync) by contacting (800) 990-9339 (toll free) or S2G(a,periscopeholdings.com. The City cannot assist with technical issues regarding submittals and will in no way be responsible for delays caused by any technical or other issue. It is the sole responsibility of each Bidder to ensure its proposal is successfully submitted in BidSync prior to the deadline for proposal submittals. 2. NON-RESPONSIVENESS. Failure to submit the following requirements shall result in a determination of non- responsiveness. Non-responsive proposals will not be considered. 1. Bid Submittal Questionnaire(submitted electronically). 2. Failure to comply with the Minimum Eligibility Requirements. 3. OMITTED OR ADDITIONAL INFORMATION. Failure to include the Bid Submittal Questionnaire (completed and submitted electronically) with the bid and by the submittal deadline shall render a proposal non- responsive. Non-Responsive proposals will not be considered. With exception of the Bid Submittal Questionnaire (submitted electronically) and the Cost/Revenue Proposal, if applicable, the City reserves the right to seek any omitted information/documentation or any additional information from Proposer or other source(s), including but not limited to: any firm or principal information, applicable licensure, resumes of relevant individuals, client information, financial information, or any information the City deems necessary to evaluate the capacity of the Proposer to perform in accordance with contract requirements. Failure to submit any omitted or additional information in accordance with the City's request shall result in proposal being deemed non-responsive. 4. ELECTRONIC PROPOSAL FORMAT. In order to maintain comparability, facilitate the review process and assist the Evaluation Committee in review of proposals, it is strongly recommended that proposals be organized and tabbed in accordance with the tabs, and sections as specified below. The electronic submittal should be tabbed as enumerated below and contain a table of contents with page references. The electronic proposal shall be submitted through the"Line Items"attachment tab in Periscope S2G. TAB 1 Cover Letter,Table of Contents,and Minimum Qualification Requirement 1.1 Cover Letter and Table of Contents.The cover letter must indicate Proposer and Proposer Primary Contact for the purposes of this solicitation. DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 MIAMI BEACH 1.2 Proposal Certification, Questionnaire & Requirements Affidavit (Appendix A). Attach Appendix A fully completed and executed. 1.3 Minimum Qualifications Requirements. Submit verifiable information documenting compliance with the minimum qualifications requirements established below: 1.3.1. Proposer or it's principals (for the purpose of this section defined as"proposing firm or principal of firm") must have a minimum of ten (10) years of experience in managing fixed income non-discretionary assets for state and local governments. Submittal Requirement: For each project that the Proposer submits as evidence of years of experience for the firm andlor any principal, the following is required: project description, agency name, agency contact, contact telephone & email, and year(s) and term of engagement. For each project, identify whether the experience is for the firm or for a principal (include name of principal). TAB 2 Experience and Qualifications 2.1 Qualifications of Proposing Firm. Submit detailed information regarding the relevant experience and proven track record of the firm and/or its principals in providing the scope of services similar as identified in this solicitation, including experience in providing similar scope of services to public sector agencies. Three (3) of which must be governmental accounts. For each project that the Proposer submits as evidence of similar experience for the firm and/or any principal, the following is required: project description, agency name, agency contact, contact telephone&email, and year(s) and term of engagement,and amount of domestic fixed income assets being managed. For each project, identify whether the experience is for the firm or for a principal(include name of principal). 2.2 Qualifications of Proposer Team. Provide an organizational chart of all personnel and consultants to be used for this project if awarded,the role that each team member will play in providing the services detailed herein and each team members' qualifications. A resume of each individual, including education, experience, and any other pertinent information,shall be included for each Proposal team member to be assigned to this contract. 2.2.1. Account Manager. Identify proposed account manager with at least ten (10) years of experience providing investment advisory services, of which, at least five (5) must be providing investment advisory services to public agencies. Include a resume which includes education,years of experience, and any other pertinent information. TAB 3 Approach and Methodology Submit detailed information on how Proposer plans to accomplish the required scope of services, including detailed information, as applicable,which addresses, but need not be limited to: • how proposer plans to accomplish the required scope of services; • proposer's understanding of public investment requirements, constraints on arbitrage regulations, and all other applicable matters; • details on Proposer's web-based investment reporting and customer access system; • details on any cost savings; • any other related value-added services that Proposer is offering; and • any cost reduction proposals that the proposer is offering. Balance of Page Intentionally Left Blank DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 SECTION 0400 PROPOSAL EVALUATION 1. Evaluation Committee.An Evaluation Committee, appointed by the City Manager, may meet to evaluate each Proposal in accordance with the qualitative criteria set forth below. In doing so, the Evaluation Committee may review and score all proposals received, with or without conducting interview sessions. City staff will assign points for the quantitative criteria. It is important to note that the Evaluation Committee is advisory only and does not make an award recommendation to the City Manager or the City Commission. The results of Step 1 & Step 2 Evaluations will be forwarded to the City Manager who will utilize the results to make a recommendation to the City Commission. a. In the event that only one responsive proposal is received, the City Manager, after determination that the sole responsive proposal materially meets the requirements of the RFQ, may, without an evaluation committee, recommend to the City Commission that the Administration enter into negotiations. b. The City, in its discretion, may utilize technical or other advisers to assist the evaluation committee in the evaluation of proposals. 2. Qualitative Criteria. Responsive proposals shall be evaluated by the Evaluation Committee in accordance with the following criteria. Qualitative Criteria Maximum Points Experience and Qualifications 60 Approach and Methodology 40 TOTAL AVAILABLE STEP 1 POINTS 100 3. Quantitative Criteria. Following the results of the evaluation of the qualitative criteria by the Evaluation Committee, the Proposers may receive additional points, to be added by City staff, as follows. Quantitative Criteria Maximum Points Veterans Preference 5 TOTAL AVAILABLE STEP 2 POINTS 5 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 4. Determination of Final Ranking. The sum of qualitative and quantitative scores will be converted to rankings in accordance with the example below: Proposer A Proposer B Proposer C Qualitative Points 82 74 80 Committee Quantitative Points 10 5 0 Member 1.• Total 92 79 80 Rank 1 3 2 Qualitative Points 82 85 72 Committee Quantitative Points 10 5 0 Member 2, Total 92 90 72 Rank 1, 2 3 " Qualitative Points 90 74 66 Committee Quantitative Points 10 5 0 Member2 Total 100 79 66 Low Aggregate Score 3 7 8 Final Ranking* 1 2 3 It is important to note that the results of the Evaluation Committee process do not represent an award recommendation.The City Manager will utilize the results of the committee process,as well as any other information he deems appropriate to develop his award recommendation to the City Commission,which may differ from the Evaluation Committee process ranking. Balance of Page Intentionally Left Blank DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 APPENDIX A M I AM I BEACH Special Conditions 2021 -090-KB (RFQ) VARIOUS BANKING SERVICES PROCUREMENT DEPARTMENT 1755 Meridian Avenue, 3rd Floor Miami Beach, Florida 33139 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 1. TERM OF CONTRACT. The term of the Agreement resulting from this RFQ shall be for an initial term of three(3)years. 2. OPTION TO RENEW. The City, through its City Manager, will have the option to extend for two (2) additional two-year periods at the City's sole discretion. The successful contractor shall maintain, for the entirety of any renewal period, the same revenue share, terms, and conditions included within the originally awarded contract. Continuation of the contract beyond the initial period, and any option subsequently exercised, is a City prerogative, and not a right of the successful contractor. a. The City reserves the right to require the consultant to extend contract past the stated termination date for a period of up to 180 days, in the event that a subsequent contract has not yet been awarded. Additional extensions past the 180 days may occur as needed by the City and as mutually agreed upon by the City and the consultant. 3. CHANGE OF ACCOUNT MANAGER. A change in account manager (as well as any replacement) shall be subject to the prior written approval of the City Manager or his designee (who in this case shall be an Assistant City Manager). Replacement (including reassignment) of an approved project manager or public information officer shall not be made without submitting a resume for the replacement staff person and receiving prior written approval of the City Manager or his designee (i.e.the City project manager). 4. SUB-CONSULTANTS. The contractor shall not retain, add, or replace any sub-consultant without the prior written approval of the City Manager, in response to a written request from the Consultant stating the reasons for any proposed substitution. Any approval of a sub-consultant by the City Manager shall not in any way shift the responsibility for the quality and acceptability by the City of the services performed by the sub-consultant from the Consultant to the City. The quality of services and acceptability to the City of the services performed by sub-consultants shall be the sole responsibility of Consultant. 5. BACKGROUND CHECKS. The Contractor shall conduct a full criminal background check at its own expense on each,of its employees engaged in providing services under this RFQ or any resulting Agreement prior to the commencement of said services.Any Contractor employee eligible to perform work pursuant to this RFQ, or resulting Agreement, shall require the prior approval of the HR Department if he or she:.(1) has been convicted of or was placed in a pre-trial diversion program for any crime involving dishonesty or breach of trust; embezzlement; drug trafficking; forgery; burglary; robbery; theft; perjury; possession of stolen property; identity theft; fraud; money laundering; shoplifting; larceny; falsification of documents and/or (2) has been convicted of any sex, weapons, or violent crime including but not limited to homicide; attempted homicide; rape; child molestation; extortion; terrorism or terrorist threats; kidnapping; assault; battery; and illegal weapon possession, sale or use. The Contractor shall defend, indemnify and hold the City, its officers, employees, and agents harmless from and against any and all liability, loss, expense (including reasonable attorney's fees) or claims for injury or damages arising out of its failure to comply with this requirement. The Contractor shall employ personnel competent to perform the work specified herein. DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 The City reserves the right to request the removal of the Contractor's employee's from performing maintenance on the City's grounds where the employee's performance or actions are obviously detrimental to the program. Contractor's personnel must wear photo identifications at all times. Balance of Page Intentionally Left Blank DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 ATTACHMENT C SUNBIZ &PROPOSAL RESPONSE TO RFQ DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 D.viSION OF CoRPOR 710NS „4. laift SVE.101 i an official State Roan websl:e Department of State / Division of Corporations / Search Records / Search by Entity Name / Detail by Entity Name Foreign Limited Liability Company PUBLIC TRUST ADVISORS, LLC Filing Information Document Number M12000000860 FEI/EIN Number 45-3356583 Date Filed 02/14/2012 State CO Status ACTIVE Last Event LC STMNT OF RA/RO CHG Event Date Filed 03/16/2018 Event Effective Date NONE Principal Address 717 17TH STREET SUITE 1850 DENVER, CO 80202 Changed: 04/25/2016 Mailing Address 717 17TH STREET SUITE 1850 DENVER, CO 80202 Changed: 04/25/2016 Registered Agent Name&Address cogency global inc. 115 North Calhoun St. Suite 4 Tallahassee, FL 32301 Name Changed: 03/16/2018 Address Changed: 04/25/2019 Authorized Person(s)Detail Name&Address I Title Ilirprtnr of Riisinpss Clnpratinns DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Dixon, Steve 717 17TH STREET SUITE 1850 DENVER, CO 80202 Title Managing,Director, MEMBER Palomba, Randy S 717 17TH STREET SUITE 1850 DENVER, CO 80202 Title Managing Director, MEMBER Tight, Thomas N , II 717 17TH STREET SUITE 1850 DENVER, CO 80202 Title Managing Director, MEMBER Grady , John F , III 201 E. Pine St. Suite 750 Orlando, FL 32801 Title Managing Director, MEMBER DeBow, Chris M 6650 Shawnee Ridge La Cincinnati, OH 45243 Title CEO, MEMBER Jordan, Thomas D 2529 Route 52 Suite 202 Hopewell Junction, NY 12533 Title MEMBER Bear Creek Asset Management, LLC 1200 17th Street, Suite 970 Denver, CO 80202 Annual Reports Report Year Filed Date 2019 04/25/2019 7n7n n4mm/9n9n DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 2021 04/29/2021 Document Images. 04/29/2021—ANNUAL REPORT View image in PDF format 04/09/2020—ANNUAL REPORT View image in PDF format 04/25/2019—ANNUAL REPORT View image in PDF format 03/16/2018—CORLCRACHG View image in PDF format 01/05/2018—ANNUAL REPORT View image in PDF format 01/12/2017—ANNUAL REPORT View image in PDF format 04/25/2016--AMENDED ANNUAL REPORT View image in PDF format 03/07/2016--ANNUAL REPORT View image in PDF format 03/16/2015—ANNUAL REPORT View image in PDF format 01/09/2014--ANNUAL REPORT • View image in PDF format 04/08/2013--ANNUAL REPORT View image in PDF format 02/14/2012--Foreign Limited View image in PDF format Florida Department of State,Division of Corporations DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 BID SUBMITTAL QUESTIONNAIRE SECTION I ® BID CERTIFICATOO 4 FORM This document is a REQUIRED FORM that must be submitted fully completed and submitted. Solicitation No: Solicitation Title: 2021-264-KB INVESTMENT ADVISORY SERVICES BIDDERS NAME:Public Trust Advisors,LLC NO.OF YEARS IN BUSINESS:10 Years NO.OF YEARS IN BUSINESS LOCALLY:9 NO.OF EMPLOYEES:70 Years OTHER NAME(S)BIDDER HAS OPERATED UNDER IN THE LAST 10 YEARS: BIDDER PRIMARY ADDRESS(HEADQUARTERS):717 17th Street,Suite 1850 CITY:Denver STATE:CO ZIP CODE:80202 TELEPHONE NO.:(855)395-3954 TOLL FREE NO.:(855)395-3954 FAX NO.: BIDDER LOCAL ADDRESS:201 E.Pine Street,Suite 750 CITY:Orlando STATE:FL ZIP CODE:32801 PRIMARY ACCOUNT REPRESENTATIVE FOR THIS ENGAGEMENT:John F.Grady ACCOUNT REP TELEPHONE NO.:(407)588-0525 ACCOUNT REP TOLL FREE NO.:(866)616-3949 ACCOUNT REP EMAIL:John.grady@publictrustadvisors.com FEDERAL TAX IDENTIFICATION NO.:45-3356583 By virtue of submitting a bid, bidder agrees: a) to complete and unconditional acceptance of the terms and conditions of this document, inclusive of this solicitation, all specifications, attachments, exhibits and appendices and the contents of any Addenda released hereto; b)to be bound, at a minimum,to any and all specifications,terms and conditions contained herein or Addenda; c)that the bidder has not divulged, discussed, or compared the proposal with other bidders and has not colluded with any other bidder or party to any other bid; d) that bidder acknowledges that all information contained herein is part of the public domain as defined by the State of Florida Sunshine and Public Records Laws; e) the bidder agrees if this bid is accepted, to execute an appropriate City of Miami Beach document for the purpose of establishing a formal contractual relationship between the bidder and the City of Miami Beach, Florida, for the performance of all requirements to which the bid pertains; and f)that all responses, data and information contained in the bid submittal are true and accurate. The individual named below affirms that s/he: is a principal of the applicant duly authorized to execute this questionnaire, and that the contents of said document(s) are complete, true, and correct to the best of his/her knowledge and belief. Name of Bidder's Authorized Representative: Title of Bidder's Authorized John F. Grady Representative: Managing Director DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2CO SECTION 2 -ACKNOWLEDGEMENT OF ADDENDUM After issuance of solicitation, the City may release one or more addendum to the solicitation, which may provide additional information to bidders or alter solicitation requirements. The City will strive to reach every bidder having received solicitation through the City's e-procurement system. However, bidders are solely responsible for assuring they have received any and all addendum issued pursuant to solicitation. This Acknowledgement of Addendum section certifies that the bidder has received all addendum released by the City pursuant to this solicitation. Failure to obtain and acknowledge receipt of all addenda may result in proposal disqualification. Enter Initial Enter Initial Enter Initial to to Confirm to Confirm Confirm Receipt Receipt Receipt JFG Addendum 1 Addendum 6 Addendum 11 JFG Addendum 2 Addendum 7 Addendum 12 ▪ Addendum 3 Addendum 8 Addendum 13 ▪ Addendum 4 Addendum 9 Addendum 14 ▪ Addendum 5 Addendum 10 Addendum 15 If additional confirmation of addendum is required,submit under separate cover. SECTION 3 - CONFLICT OF INTEREST All bidders must disclose the name(s) of any officer, director, agent, or immediate family member (spouse, parent, sibling, and child) who is also an employee of the City of Miami Beach. Further, all bidders must disclose the name of any City employee who owns, either directly or indirectly, an interest of ten (10%) percent or more in the bidder entity or any of its affiliates. 0 YES p NO If yes, please disclose the name(s): FIRST AND LAST NAME OCCUPATION 1 2 3 4 5 6 SECTION 4 - FINANCIAL CAPACITY When requested by the City, each bidder shall arrange for Dun & Bradstreet to submit a Supplier Qualification Report (SQR) directly to the City. No proposal will be considered without receipt, by the City, of the SQR directly from Dun & Bradstreet. The cost of the preparation of the SQR shall be the responsibility of the bidder. The bidder shall request the SQR report from D&B at: https://supplierportal.dnb.com/webapp/wcs/stores/servlet/SupplierPortal? storeld=11696 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Bidders are responsible for the accuracy of the information contained in its SQR. It is highly recommended that each bidder review the information contained in its SQR for accuracy prior to submittal to the City and as early as possible in the solicitation process. For assistance with any portion of the SQR submittal process, contact Dun & Bradstreet at 800-424-2495. At time of request, bidder shall request that Dun & Bradstreet submit its Supplier Qualifier Report directly to the City, with bid or within three (3) days of request. SECTION 5 - MORATORIUM ON TRAVEL TO AND THE PURCHASE OF GOODS OR SERVICES FROM MISSISSIPPI Pursuant to Resolution 2016-29375, the City of Miami Beach, Florida, prohibits official City travel to the state of Mississippi, as well as the purchase of goods or services sourced in Mississippi. Bidder shall agree that no travel shall occur on behalf of the City of Miami Beach to Mississippi, nor shall any product or services it,provides to the City be sourced from this state. By virtue of submitting bid, bidder agrees it is and shall remain in full compliance with Resolution 2016-29375 https://www.miamibeachfl.gov/wp-content/uploads/2017/11/2016-29375-Resolution- Vendor-Moratorium-for-Services-Sources-from-North-Carolina-Mississippi=l.pdf DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 SECTION 6 - REFERENCES AND PAST PERFORMANCE Project No. 2021-264-KB Project Title INVESTMENT ADVISORY SERVICES Bidder shall submit at least three (3) references for whom the bidder has completed work similar in size and nature as the work referenced in solicitation. Reference No.1 Firm Name: City of Miami Beach Contact Individual Name and Title: John Woodruff, CFO and/or Sara Patino, sarapatino@miamibeachfl.gov Address: 1700 Convention Center Drive, Miami,Beach, FL 33139 Telephone: 305-673-7466 Contact's Email: johnwoodruff@miamibeachfl.gov Narrative on Scope of Services Provided: Firm and Principal (John Grady) has served the City of Miami Beach from 2003-2012 and 2015 -current. A diversified investment program of 18 individual portfolios that are managed independently based sources of revenues and timing of expenditures; Monthly Teams meeting calls to provide market and portfolio strategy updates; Non-discretionary advice: Trade recommendations with transaction details for review and pre-approval; Applied for and received the Association of Public Treasurer/ s of the U.S. and Canadas s Investment Policy Certification; Manage the Citys s investment program is rated AAA by Standard and Poorss ; Annual training in person and virtual to meet the requirements of Florida State Statutes Reference No.2 Firm Name: City of Coral Springs Contact Individual Name and Title: Kim Moskowitz, CPA, City Controller Address: 9500 West Sample Road, Coral Springs, FL 33065 Telephone: (954) 344-1092 Contact's Email: kmoskowitz@coralsprings.org Narrative on Scope of Services Provided: Firm and Principal (John Grady) has served the City of Coral Springs from 2005-2012, and 2017-Current; Provide investment advice for liquidity and core investment assets; A diversified investment program of 2 individual portfolios that are managed independently based sources of revenues and timing of expenditures; Quarterly investment committee meetings to provide market and portfolio strategy updates; Discretionary investment DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 portfolio for core and reserve funds; Online reporting platform with enhanced month end statements; Annual training in person and virtual to meet the requirements of Florida State Statutes Reference No.3 Contact Individual Name and Title: Tanya W. Quickel, Deputy Village Manager, Village of Wellington Address: 12300 Forest Hill Boulevard, Wellington, FL 33414 Telephone: (561) 791-4113 Contact's Email: tquickel@wellingtonfl.gov Narrative on Scope of Services Provided: Firm and Principal(John Grady) has served the Village of Wellington since 2017; Provide investment advice for liquidity and core investment assets; A diversified investment program of 2 individual portfolios that are managed independently based on sources of revenues and timing of expenditures; Quarterly investment committee meetings to provide market and portfolio strategy updates; Discretionary investment portfolio for core and non-discretionary for capital projects; Online reporting platform with enhanced month-end statements; Annual training in person and virtual to meet the requirements of Florida State Statutes DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Additional Reference Firm Name: City of Naples Contact Individual Name and Title: Jodi Bain, Senior Accountant Address: 735 8th St. S, Naples, FL 34102 Telephone: (239) 213-1816 Contact's Email: jbain@naplesgov.com Narrative on Scope of Services Provided: Firm and Principal (John Grady) has served the City of Naples from 2005-2012, and 2012-Current; Provide investment advice for liquidity and core investment assets; A diversified investment program of an Aggregate investment portfolio that is managed independently based sources of revenues and timing of expenditures; Quarterly investment committee meetings to provide market and portfolio strategy updates; Non- discretionary advice: Trade recommendations with transaction details for review and pre- approval; Online reporting platform with enhanced month end statements; Annual training in person and virtual to meet the requirements of Florida State Statutes SECTION 7 - STANDARD TERMS AND CONDITIONS The Standard Terms and Conditions are available at https://www.miamibeachfl.gov/city_ hall/procurement/standard-terms-and-conditions/ By virtue of submitting a bid, bidder attests that they have read and understand the applicable Standard Terms and Conditions as indicated in the solicitation. Project No. 2021-264-KB Project Title INVESTMENT ADVISORY SERVICES SECTION 8 -VEND•R CAMPAIGN`! CONTRIBUTIONS Bidders are expected to be or become familiar with, the City's Campaign Finance Reform laws, as codified in Sections 2-487 through 2-490 of the City Code https://library.municode.com/flimiami beach/codes/code_of ordinances? nodeld=SPAGEOR_CH2AD_ARTVIISTCO_DIV5CAFIRE Bidders shall be solely responsible for ensuring that all applicable provisions of the City's Campaign Finance Reform laws are complied with, and shall be subject to any and all sanctions, as prescribed therein, including disqualification of their bid submittal, in the event of such non-compliance. Are there any individuals or entities (including your sub-consultants) with a controlling financial interest which have contributed to the campaign either directly or indirectly, of a candidate who has been elected to the office of Mayor or City Commissioner for the City of Miami Beach. YES p NO DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 If yes, list name (first and last name) of individuals, occupation, amount and date: First and Last Contributor Occupa on Amount Date of Name Contribu on 1 2 3 4 5 6 7 8 9 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 SECTION 9--SUSPENSION, ',EBARMENT, OR CONTRACT CANCELLATION Has bidder ever been debarred, suspended or other legal violation, or had a contract cancelled due to non-performance by any public sector agency? O YES p NO If answer to above is "YES," bidder shall submit a statement detailing the reasons that led to action(s): SECTION 10 - EQUAL BENEFITS FOR EMPL*YEES WITH SPOUSES AND EMPLOYEES WITH DOMESTIC PARTNERS When awarding competitively solicited contracts valued at over $100,000 whose contractors maintain 51 or more full time employees on their payrolls during 20 or more calendar work weeks, the Equal Benefits for Domestic Partners Ordinance 2005-3494 requires certain contractors doing business with the City of Miami Beach, who are awarded a contract pursuant to competitive bids, to provide "Equal Benefits" to their employees with domestic partners, as they provide to employees with spouses. The Ordinance applies to all employees of a Contractor who work within the City limits of the City of Miami Beach, Florida; and the Contractor's employees located in the United States, but outside of the City of Miami Beach limits, who are directly performing work on the contract within the City of Miami Beach. Does bidder provide or offer access to any benefits to employees with spouses or to spouses of employees? p YES E NO Does bidder provide or offer access to any benefits to employees with (same or opposite sex) domestic partners or to domestic partners of employees? ® YES LI NO Please check all benefits that apply to your answers above and list in the "other" section any additional benefits not already specified. Note: some benefits are provided to employees because they have a spouse or domestic partner, such as bereavement leave; other benefits are provided directly to the spouse or domestic partner, such as medical insurance. Bidder Provides for Bidder Provides for Bidder does not BENEFIT Employees with Employees with Spouses Domestic Partners Provide Benefit Health Yes Yes Sick Leave Yes Yes Family Medical Leave Yes Yes • Bereavement Leave Yes Yes If Bidders cannot offer a benefit to domestic partners because of reasons outside your control, (e.g., there are no insurance providers in your area willing to offer domestic partner coverage) you may be eligible for Reasonable Measures compliance. To comply on this basis, you must agree to pay a cash equivalent and submit a completed Reasonable Measures Application with all necessary documentation. Your Reasonable Measures Application will be reviewed for DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 consideration by the City Manager, or his designee. Approval is not guaranteed and the City Manager's decision is final. Further information on the Equal Benefits requirement is available at http://www.miamibeachfl.gov/city-hall/procurement/procurement-related-ordinance-and- procedures/ DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 SECTION 11 - BYRD ANTI-Ls-BBYING AMENDMENT CERTIFICATION FORM APPENDIX A,44 C.F.R. PART 18—CERTIFICATION REGARDING LOBBYING Cer fica on for Contracts,Grants, Loans,and Coopera ve Agreements The undersigned Contractor cer fies,to the best of his or her knowledge,that: 1. No Federal appropriated funds have been paid or will be paid, by or on behalf of the undersigned, to any person for influencing or a. empting to influence an officer or employee of an agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connec on with the awarding of any Federal contract, the making of any Federal grant, the making of any Federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment, or modifica on of any Federal contract,grant, loan, or cooperative agreement. 2. If any funds other than Federal appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with this Federal contract, grant, loan, or coopera ve agreement, the undersigned shall complete and submit Standard Form-LLL, "Disclosure Form to Report Lobbying," in accordance with its instructions. 3. The undersigned shall require that the language of this certifiea on be included in the award documents for all subawards at all tiers (including subcontracts, subgrants, and contracts under grants, loans, and cooperative agreements) and that all subrecipients shall certify and disclose accordingly. This cer fication is a material representation of fact upon which reliance was placed when this transaction was made or entered into. Submission of this certification is a prerequisite for making or entering into this transac on imposed by 31, U.S.C. § 1352 (as amended by the Lobbying Disclosure Act of 1995).Any person who fails to file the required certifiea on shall be subject to a civil penalty of not less than $10,000 and not more than $100,000 for each such failure. The undersigned Contractor certifies or affirms the truthfulness and accuracy of each statement of its certifica on and disclosure, if any. In addi on, the Contractor understands and agrees that the provisions of 31 U.S.C. § 3801 et seq., apply to this certifica on and disclosure, if any. By virtue of submitting bid, bidder certifies or affirms its compliance with the Byrd Anti- Lobbying Amendment Certification. Name of Bidder's Authorized Representative: Title of Bidder's Authorized John F. Grady Representative: Managing Director DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 SECTION 12 —SUSPENSION AND DEBAR ENT CERTIFICATION The Contractor acknowledges that: (1)This Contract is a covered transaction for purposes of 2 C.F.R. pt. 180 and 2 C.F.R. pt. 3000. As such the contractor is required to verify that none of the Contractor, its principals (defined at 2 C.F.R. § 180.995), or its affiliates (defined at 2 C.F.R. § 180.905) are excluded (defined at 2 C.F.R. § 180.940) or disqualified (defined at 2 C.F.R. § 180.935). (2)The Contractor must comply with 2 C.F.R. pt. 180, subpart C and 2 C.F.R. pt. 3000, subpart C and must include a requirement to comply with these regula ons in any lower Der covered transac on it enters into. (3) This cerI Ifica on is a material representa on of fact relied upon by the City. If it is later determined that the Contractor did not comply with 2 C.F.R. pt. 180, subpart C and 2 C.F.R. pt. 3000, subpart C, in addiLIon to remedies available to the City, the Federal Government may pursue available remedies, including but not limited to suspension and/or debarment. (4) The Contractor agrees to comply with the requirements of 2 C.F.R. pt. 180, subpart C and 2 C.F.R. pt. 3000, subpart C while this offer is valid and throughout the period of any contract that may arise from this offer. The Contractor further agrees to include a provision requiring such compliance in its lower er covered transac ons." By virtue of submitting bid, bidder certifies or affirms its compliance with the Suspension and Debarment Certification. Name of Bidder's Authorized Representative: Title of Bidder's Authorized John F. Grady Representative: Managing Director SECTION 13 - SMALL AND DISADVANTAGED BUSINESS CERTIFICATION Pursuant to Resolu on 2020-31519, the City is tracking the Small and Disadvantaged Businesses, as cerMfied by Miami-Dade County that have been cerl]fied as Small or Disadvantaged Business by Miami-Dade County. Does bidder possess Small or Disadvantaged Business cerI fica on by Miami-Dade County? YES p NO SECTION 14 - LGBT BUSINESS ENTERPRISE CERTIFICATION Pursuant to Resolu on 2020-31342, the City is tracking the u liza on of LGBT owned firms that have been cer fled as an LGBT Business Enterprise by the National Gay and Lesbian Chamber of Commerce (NGLCC). Does bidder possess LGBT Business Enterprise Cer fica on by the NGLCC? 0 YES 131 NO DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 SECTD!•<<! 15 a CONE OF SBLE .iCE Pursuant to Sec on 2-486 of the City Code, all procurement solicita ons once adverI sed and unI1l an award recommenda on has been forwarded to the City Commission by the City Manager are under the "Cone of Silence." The Cone of Silence ordinance is available at hops://library.municode.com/fl/miami beach/codes/code of ordinances? nodeld=SPAGEOR CH2AD ARTVIISTCO DIV4PR 52-486COSI Any communica on or inquiry in reference to this solicita on with any City employee or City official is strictly prohibited with the of excep on communica ons with the Procurement Director, or his/her administra ve staff responsible for administering the procurement process for this solicital]on providing said communica on is limited to matters of process or procedure regarding the solicita on. Communica ons regarding this solicita on are to be submitted in wri ng to the Procurement Contact named herein with a copy to the City Clerk at rafaelgranadoPmiamibeachfl.gov Vendor attests that they have read, understand, and are in compliance with the Cone of Silence Ordinance, pursuant to Secl on 2-486 of the City Code? p YES O NO DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 SECTION 16— CODE OF BUSINESS ETHICS Pursuant to City ResolulDon No.2000-37879, the Bidder shall adopt a Code of Business Ethics ("Code") and submit that Code to the Procurement Division with its response or within three (3) days upon receipt of request. The Code shall, at a minimum, require the Bidder, to comply with all applicable governmental rules and regula ons including, among others, the conflict of interest, lobbying and ethics provision of the City of Miami Beach and Miami Dade County. Bidder shall submit firm's Code of Business Ethics within three (3) of request by the City. In lieu of submitting Code of Business Ethics,Vendor may indicate that it will adopt, as required in the ordinance, the City of Miami Beach Code of Ethics, available at http://www.miamibeachfl.gov/city-hall/procurement/procurement-related-ordinance-and- procedures/ Bidder adopts the City of Miami Beach Code of Business Ethics? p YES NO Bidder will submit firm's Code of Business Ethics within three(3) days of request by the City? p YES O NO SECTION 17— DRUG FREE WORKPLACE CERTIFICATION The Drug Free Workplace Cer ficallon is available at: hops://www.miamibeachfl.gov/wp-content uploads/2019/04/DRUG-FREE-WORKPLACE- CERTIFICATION.pdf By virtue of submitting bid, bidder certifies or affirms it has adopted policies, practices and standards consistent with the City's Drug Free Workplace Certification. SECTION 18— LOBBYIST REGISTRATION REQUIRE''4,ENTS This solicital1on is subject to, and all bidders are expected to be or become familiar with, all City lobbyist laws. Bidders shall be solely responsible for ensuring that all City lobbyist laws are complied with, and shall be subject to any and all sanc1ons, as prescribed therein, including, without limita1on, disqualifica1on of their responses, in the event of such non-compliance. By virtue of submitting bid, bidder certifies or affirms that they have read and understand the above Lobbyist Registration Requirements. SECTION 19— ON-DISCRI'`.iINATION The Non-DiscriminalIon ordinance is available at: hitps://library.municode.com/fl/miami beach/codes/code of ordinances? nodeld=SPAGEOR CH2AD ARTVIPR DIV3COPR S2-375NSCCOREWA By virtue of submitting bid, bidder agrees it is and shall remain in full compliance with Section 2-375 of the City of Miami Beach City Code. SECTION 20— FAIR CHANCE REQUIREMENT DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 The Fair Chance Ordinance No. 2016-4012 is available at: hitps://library.municode.com/fl/miami beach/codes/code of ordinances? nodeld=SPAGEOR CH62HURE ARTVFACHOR By virtue of submitting bid, bidder certifies that it has adopted policies, practices and standards consistent with the City's Fair Chance Ordinance. Bidder agrees to provide the City with supporting documentation evidencing its compliance upon request. Bidder further agrees that any breach of the representations made herein shall constitute a material breach of contract, and shall entitle the City to the immediate termination for cause of the agreement, in addition. to any damages that may be available at law and in equity. SECTI;• H 21— PUBLIC ENTITY CBII',1ES Please refer to Sec1on 287.133(2)(a), Florida Statutes, available at: https://www.flsenate.gov/Laws/Statutes/2012/287.133 By virtue of submitting bid, bidder agrees with the requirements of Section 287.133, Florida Statutes, and certifies it has not been placed on convicted vendor list. DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 SECTION 22®VETERAN BUSINESS ENTERPRISES PREFERENCE Pursuant to City of Miami Beach Ordinance No. 2011- 3748, hops://library.municode.com/fl/miami beach/codes/code_of ordinances? nodeld=SPAGEOR CH2AD ARTVIPR DIV3COPR S2-374PRPRPRVECOGOCOSE the City shall give a preference to a responsive and responsible bidder which is a small business concern owned and ,controlled by a veteran(s) or which is a service-disabled veteran business enterprise, and which is within five.percent (5%) of the lowest and best bidder, by providing such bidder an opportunity of providing said goods or contractual services for the lowest responsive bid amount. Whenever, as a result of the foregoing preference, the adjusted prices of two (2) or more bidders which are a small business concern owned and controlled by a veteran(s) or a service-disabled veteran business enterprise cons tute the lowest bid pursuant to an ITB, RFP, RFQ, ITN or oral or written request for quotal]on, and such bids are responsive, responsible and otherwise equal with respect to quality and service, then the award shall be made to the service-disabled veteran business enterprise. Is the bidder a service-disabled veteran business enterprise certified by the State of Florida? 0 YES p NO Is the bidder a service-disabled veteran business enterprise certified by the United States Federal Government? YES p NO DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2CO PU.BLIC® �fr TRUST ADVISORS September 22,2021 Kristy Bada, Bid Contact Danny Flores, Bid Contact City of Miami Beach 1755 Meridian Avenue 3rd Floor Miami Beach Fl 33139 RE:Solicitation 202I-264-KB for Investment Advisory Services Dear Ms. Bada and Mr. Flores: Public Trust Advisors, LLC (Public Trust) appreciates the opportunity to respond to the Solicitation to continue to provide Investment Advisory Services for the City of Miami Beach (the City). Please find attached our proposal in response to Solicitation 2021-264-KB for Investment Advisory Services. Born from the idea that public sector investors were being overcharged and underserviced, Public Trust offers high-quality services at a competitive cost,striving to help local governments,including the City,maximize their investment income while providing more resources to assist and serve their local community. Our mission is to create trusted investment management solutions that safeguard our clients'assets and provide competitive market returns while delivering an exceptional customer experience. We understand the services requested in your scope of services and our highly qualified professionals are committed to continuing to provide the City with the resources and experience necessary to fulfill these services at the highest level. Public Trust's Dedication to The Public Sector Public Trust was founded on the principles of developing and maintaining strong relationships resulting in client needs-focused communication and a holistic approach to the treasury and investment management function. For more than two decades, Public Trust professionals have provided investment solutions for our public sector clients. These individuals have a long history of implementing truly customized investment solutions for our clients who,like the City,are seeking to maximize the investment income and return of their portfolios while adhering to the primary investment objectives of safety and liquidity. While other firms continue to diversify resources away from public sector investment programs due to the prolonged low interest rate environment, Public Trust is fully committed to this sector and 100% of our firm resources are dedicated exclusively to the management and investment advisory services for public funds exclusively. As of June 30,2021,Public Trust manages $51.4 billion in assets for 76 public fund and governmental entities with more than 237 individual portfolios, all of which are domestic fixed income public funds. Our Commitment to the City of Miami Beach We believe a successful investment program is based on deep knowledge of the specific characteristics of the investment objectives of each client.The entire Public Trust team,led by the City's primary relationship managers John Grady,Managing Director,and Rod Bettini,Director,will continue to provide the City with our firm wide resources and be committed to the long-term success of the City's investment program and to providing excellent client service. As our Florida public sector presence continues to grow, we have added significant resources to continually support our clients' needs. Our goal is to ensure we continue strengthening our client relationships through consistent communication and unrivaled service. This includes additional portfolio management and credit professionals at our headquarters in Denver, and advisory and analytical support in our Orlando,Florida office. The City's investment advisory relationship would continue to be supported by seven Florida-based investment professionals located in our Orlando office and by more than 25 Denver- based professionals,dedicated to the success of the City's investment program. Tailored Investment Program We have developed a tailored an investment program to the specific sources and uses of the City's revenues and bond proceeds and we work closely with the City's finance team to ensure each investment portfolio is managed to meet the cash flow needs of the City. We have included a detailed description of our approach for the City's investment program in our responses to the Scope of Services listed in the RFQ. This information is included our proposal and has been included in section that also includes the Table of Contents and Minimum Qualifications. 201 E. Pine Street, Suite 750, Orlando, FL 32801 — (407) 588-0525 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 : J PUBLIC Page 2 � n TRUST U ADVISORS • Two examples that highlight the success and the ability to meet the most stringent criteria for the management of the City's investment program include the AAA rating assigned by Standard and Poors' (S&P)and the Investment Policy Certification recognized by the Association of Public Treasurers' (APT). We provide considerable transparency through our communication including monthly investment reviews along with robust online transaction management and reporting systems so that the City will have a daily reconciliation of all accounts. The City will have dedicated relationship and portfolio managers that are intimately familiar with the City's investment program, with the continued goal of providing the highest quality of service, including rapid responses to inquiries and consistent communication between the City's staff and our portfolio management team and investment advisors. All securities transactions are competitively bid,when possible,in accordance with each client's investment policy statement. Unlike many other firms that may serve in other financial service-related functions(e.g.,financial advisor,underwriter,banking institutions,bond insurers),or firms that have undergone major consolidations with national banking institutions,Public Trust has no conflict of interest in the management of its clients'accounts and our investment professionals have no financial interest in any other services provided to our clients. Public Trust only manages fixed income assets for public entity clients with the same goals and objectives as the City of Miami Beach. An Independent Registered Investment Advisor Public Trust Advisors, LLC,a Colorado limited liability company is an investment adviser registered with the U.S.Securities and Exchange Commission (SEC) under the Investment Adviser's Act of 1940, as amended. Public Trust is not a trust company, bank, or savings and loan institution, and does not receive any economic benefit, directly or indirectly from any third-party for advice rendered to its clients. Public Trust adheres to the CFA Institute Code of Ethics and Standards of Professional Conduct as well as our own Public Trust Professional Code of Conduct. We do not act as a broker or primary dealer in securities,and we prohibit the use of third-party soft dollar arrangements. Our only source of compensation comes from our clients for investment advisory services. We never take possession of client monies or securities. All of the City's assets are held in third party custody accounts in the City's name at Fiduciary Trust. Public Trust is a growing,financially solvent,and well capitalized firm.In founding our firm,we sought to establish appropriate levels of capital and resources which we believe allow Public Trust to provide a high level of services to all our clients and the ability to meet the requirements of this proposal. Public Trust is 100%privately owned and we offer employee ownership. In an ever-changing marketplace,Public Trust remains committed to our public-sector clients.We offer cost effective turnkey solutions for many of the services required by the institutional public funds market in general and the City of Miami Beach specifically. Our ongoing dedication to servicing our client's investment needs is what defines Public Trust. We believe that our commitment to the public funds sector is more necessary than at any time since the Great Recession in 2008,and potentially in the last 100 years. Public Trust is 100% committed to our public sector clients.We continue to enhance our technology capabilities firmwide and our team continues to grow even during the current economic downturn and pandemic. We believe this approach will be the difference in the success and safety of our clients'investment programs. We appreciate your consideration of Public Trust to continue to provide investment advisory services to the City. If you have any questions or if we can provide additional information,please contact John Grady at 407-701-8002. Respectfully Submitted, 4 John Grady III Rodrigo Bettini Director Managing Director 201 E. Pine Street, Suite 750, Orlando, FL 32801 — (407) 588-0525 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC® I'I TRUST IIADVISORS F t,,. ,,,k A. , ' t � � ` C r - Original S J : 1 / ,-. ',"4 ri'. -_.dt. , t City of Miami Beach i ~ . . �; ' Request for Proposal „- ,',,,- Solicitation 202 I-264-KB 0 ° Investment Advisory Services ,..qt..*,,.. , .,. ,, , „ ,... ,. ,,,.,, , , ,, ,,, ,,. . w.. ._ ..,,,, - , , .„, , V. r , , t , ,, , . ..,, v c, , ,, ' r 1 . rfr , ' ' ',:`,..`,"441A sjJ„ . �'�, . ,'ysd M I AM I B EAC H „.;_i, ..,_ ,,,, .h. ,.:. ,.. . . , .., ,„ , .... , . ir....:, . ,, , ,,,_ _Are t ,.., : 1 > 1 yy A I, i X k" P 1 1 n "SAS,,,, { r,1 w. 7.{F^ . ,� /y 1 1 t Due September 22, 2021 by 3:00 PM DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 MIN wow 11111 Table of Contents Section Tab Cover Letter,Table of Contents,and Minimum Qualification Requirements. 1 1.1 Cover Letter and Table of Contents. 1.2 Proposal Certification, Questionnaire&Requirements Affidavit(Appendix A). 1.3 Minimum Qualifications Requirements. Responses to Statement of Work Required Experience and Qualifications 2 2.1 Qualifications of Proposing Firm. 2.2 Qualifications of Proposer Team. 2.2.1.Account Manager. Approach and Methodology 3 Appendix Items Form ADV Part 2A Appendix A Insurance Certificate Appendix B Privacy Policy Appendix C Sample Reporting Statement Appendix D Team Biographies Appendix E • ---------------------------- --------- --------- — -------- -------- Public Trust Advisors DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Tabi b 1 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 t 1 1.111,1 I. Cover Letter, Table of Contents, and Minimum Qualifications Requirement 1.1 Cover Letter and Table of Contents The cover letter must indicate Proposer and Proposer Primary Contact for the purposes of this solicitation. Please refer to the cover letter preceding this proposal. 1.2 Proposal Certification, Questionnaire & Requirements Affidavit (Appendix A) Attach Appendix A fully completed and executed. Please refer to the Proposal Certification, Questionnaire and Requirements affidavit completed on Periscope. 1.3 Minimum Qualifications Requirements 1.3.1. Proposer or it's principals(for the purpose of this section defined as"proposing firm or principal of firm")must have a minimum of ten (I 0)years of experience in managing fixed income non-discretionary assets for state and local governments. Submittal Requirement: For each project that the Proposer submits as evidence of years of experience for the firm and/or any principal,the following is required:project description,agency name,agency contact, contact telephone&email, and year(s)and term of engagement. For each project, identify whether the experience is for the firm or for a principal (include name of principal). Dedicated, Experienced Team of Investment Professionals The Public Trust team has a long history of serving the City of Miami Beach in our role as investment advisor and fiduciary for the City's investment program. Originally, from 2003 — 20I2, and currently since 2015, members of the Public Trust Executive team, in close partnership with the City's Finance and Treasury team and staff, have implemented and managed a fully customized investment program based on the City's unique cash flows, risk tolerances and investment objectives. This collaborative approach is focused on the shared goals of providing a high quality,safe and liquid portfolio with an eye toward maximizing risk adjusted returns. The City would continue to be served by an experienced, knowledgeable team and will have direct contact with the relationship team members. While other firms provide a single contact or a help desk,at Public Trust we provide a team of professionals that will be intimately familiar with each client relationship. The primary engagement team is presented below. Each team member's responsibilities are described in Section 2.2 Qualifications of the Proposer Team. John Grady, Cory Gebel, CFA, Rod Bettini, and Tiffany Singh will serve as the primary contacts for the City and their responsibilities include: r ► ' ,-/ + ' tt John F.Grady Rod Bettini Cory Gebel,CFA Tiffany Singh Managing Director Director Director Investment Analyst 23 Years Experience 12 Years Experience 22 Years Experience 4 Years Experience Portfolio Manager u Continue to work closely with the Chief Financial Officer, Deputy Finance Director,Treasury Manager and other City finance and investment professionals(Investment Team)to ensure an effective,compliant investment program ▪ Monthly conference calls and reporting with the City's Investment Team for a detailed discussion of expectations regarding the approach to the investment program including strategy',client service,communication,and reporting T Ongoing cash flow discussions to confirm appropriate allocation of financial assets within the City's longer term core portfolio,and assets designated for short term expenditures Assist with recommendations for investment options for the City's investment portfolios and coordinate with the Treasury Manager for FLCLASS balances to ensure appropriate liquidity for short term expenditures . Provide training annually to meet the requirement of Florida State Statute(14) Continuing Education 7 Continuous treasury management support from a team of professionals throughout the engagement I ( Public Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 C, 1 HEMI. Cover Letter, Table of Contents, and Minimum Qualifications Requirement Relevant Florida City Public Funds Investment Experience The City's relationship team has served Florida Cities and other public entities for two decades. We currently provide investment advisory and management services for the following Cities around the State of Florida, including several client relationships in South Florida. We believe our clients'investment success is the result of a proven approach and commitment to our client relationships that focuses on the safety of public funds,meaningful communication,compliance,and transparency. Cr P Tr $52.5 Million AUM rI rtda Non-Discretionary $897.6 Million AUM - . Discretionary yC,LIMA IPLANT $52.9 Million AUM I C,1 1'Y Non-Discretionary Discretionary $23.8 Million AUM MIAMI BEAcri Discretionary - �'""�, $476.0 Million AUM �, �� Non-Discretionary —""t'!3 ( $20.4 Million AUM Cape 1fj Discretionary VriguQnnLL $260.1 Million AUM Discretionary f'f'fiLL1N6TUN El Man $88.7 Million AUM c.,,O /' Discretionary $262.6 Million AUM Lf Va/J eSn...i Non-Discretionary Discretionary $103.5 Million AUM • Non-Discretionary TAMARAC CORAL ma City Far Yourute SPRINGS_ $24.3 Million AUM $105.7 o Non-Discretionary Non-DiscreMillitionarynAUM ' `t' Discretionary $15.4 Million AUM Non-Discretionary ^-Illy Od $150.0 Million AUM Discretionary *AUM is as of August 31,2021 _______—__ ._ ___ __ -- —2I_Public Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 itnI Statement of Work Required Statement of Work Required The City requires that the selected provider,at a minimum,provide the following services I. The City expects its investment advisor to be highly experienced, a leader and innovator in the management of investments, and able to provide comprehensive investment advisory services.The firm selected as the investment advisor and its affiliates will be restricted from selling to the City,or buying from the City,any securities to or from that firm's own inventory or account. Public Trust is an independent,privately held company with no affiliates nor parent company,and was formed exclusively to service the public funds marketplace.Public Trust provides a multitude of investment solutions that rely on market experience and proven processes, combined with modern back-office systems.We proudly serve more than 76 SMA clients and more than 237 individual portfolios in a variety of locations nationwide that represent many different entity types such as counties, cities,and special districts.Pair that with our staff of nearly 70 professionals and the result is significant resources,attention, and dedication to every client's unique needs. For more than twenty years, public sector entities have trusted our professionals to provide investment management and advisory services for their liquidity, operating, reserve and bond funds while first considering the safety and liquidity of the funds under management.We hand-select industry professionals with significant institutional knowledge and experience from their prior roles to further deepen and differentiate the services we offer. Public Trust is independent and privately owned, including employee ownership,a structure which ties firm success directly to the success of our clients.Our independence ensures that the firm remains accountable to only our clients,and not to a parent company or outside investor. Our approach and commitment to our public sector clients is to serve as an extension of staff,to provide a level of service that exceeds our clients'expectations,and to leverage technology to allow our team of professionals to focus on the goal of implementing a successful investment program for each unique client. We believe this success is achieved as a result of our more than three decades of public funds experience. managing LGIPs and SMAs in Florida and around the country. This knowledge results in our professionals'recognizing the differences in the timing of cash flows from various revenue sources and the use of the sources for various expenditures,from bi-weekly payroll to long term capital plan expenditures and the separation of projects funded with bond proceeds for spending and arbitrage purposes. We also believe there continues to be opportunities for innovation within public funds investment management, some resulting from advances in technology. Newer technology has also led to a reduction in the time and resources required for accounting and reporting functions. Public Trust has been providing comprehensive advisory services to the City officially since 2015, and our professionals in previous roles,since 2003. Further, Public Trust is not a broker dealer and we do not own an inventory of securities,so there is no risk of buying or selling securities from our inventory. 2. The investment advisor will also be restricted from placing into the City's portfolio any securities for which it,or an affiliate,is the issuer.Investment advisors will not provide custodial services or security safekeeping. Public Trust is an independent investment advisor with no conflicts of interest unlike firms that are compensated from serving multiple roles within the public sector such as underwriters, banking Public Trust does institutions, insurance companies, and financial advisory consultants. Our independence as a SEC not own,or issue registered investment advisor,and not a unit of an underwriting firm, prevents a scenario in which debt,and we do a security can be underwritten by our firm and potentially purchased or sold from a client investment not serve as portfolio. We do not transfer revenues or profits from our asset management firm to other joint custodian. All ventures, subsidiaries, or owner owned companies affiliated under a parent company structure unlike other firms within the industry. Public Trust does not act as a broker or primary dealer;we City assets will do not receive any other form of additional compensation (including soft dollars). continue to be held in a 3'party Public Trust never provides custodial services or safekeeping for our clients'accounts and all assets under management are held in a separate safekeeping or custodial account in the client's name. custody account. I ( Public Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 1 J MOStatement of Work Required 3. All City investments,except for swap agreements must be held in an independent custodial account. Public Trust never takes possession of our clients'assets.,All assets we manage are held with a third-party custodian selected by the client. Only Authorized Individuals as defined within the investment policy statement and in Banking and Custody/Safekeeping and other legal documentation are permitted to move cash and/or securities in to or out of the custody account. 4. Provide full-time management on a daily basis of the City's investment portfolio pursuant to the specific stated investment objectives and the City's Investment Policy. Daily Portfolio Management We manage and advise the City's investment program adhering to the Prudent Expert Standard which states that the investment manager will act with the care,skill,prudence,and diligence under the circumstances then prevailing that a prudent investment expert acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims. Prior to sending our investment recommendation,we communicate with the City's Treasury Safaty Manager to determine the preferred investment structure and target duration for each individual investment portfolio. Once the strategy is confirmed, we communicate our suggested investment with specific bond characteristics and a brief summary of how the 1 investment strategy complements the desired portfolio characteristics. Liquidity We emphasize a conservative, client-focused approach that centers on providing fully - customized investment solutions along with the full commitment of our firm's resources.We 1. seek to maximize safety within the parameters established by each client,while seeking to improve investment return and earnings. An emphasis on high-quality securities, Yield diversification,and the minimization of volatility helps ensure our clients'portfolios maintain the appropriate balance of safety and liquidity throughout market cycles. We apply active management strategies to capitalize on market opportunities and control , the portfolio's risk exposure, while employing dedicated and experienced professionals in Transparency accounting and operations that provide an efficient approach to the treasury management function.Our investment philosophy focuses exclusively on the public-sector and is guided by five major principles (in order of importance): safety, liquidity, transparency, compliance, and investment return.Within this conservative framework, our investment approach is based on the belief that consistently strong fixed income returns are achieved through the disciplined and active management of the market sectors that enhance income. Investment Management Philosophy Our investment philosophy is based on the safety principle of _ _ .... . .._ .- protecting the public funds we manage on behalf of our clients. Y Invesunent Advisory - le Credit Research Our use of diversification and pre- and post-trade verification Collaboration Collaboration minimizes market value volatility, prevents exposure to - __ noncompliant securities within the portfolio, and provides i complete transparency to the strategy and holdings of the Investment objectives i i Overall firm'strategy portfolio daily. By adhering to these principles, our goal is to - provide strong, risk-adjusted returns.We provide discretionary q portfolios specific l Asset allocatlontargets and non-discretionary asset management based on revenue type, p �' ' investment objectives,and the characteristics of each client. -- -- ; i -- - Our approach to providing investment advisory services is to be considered an internal resource for the clients'staff.We believe _ this enhances our clients' cash and investment management ' . l I ' Portfolio.reconciliation ' ' Pre-and post-trade programs through efficiency and effectiveness.We only manage ) - fixed income assets for our public entity clients. Our portfolio compliance managers' expertise is in managing portfolios consisting of U.S. ! : Treasuries,Federal Agencies,and,where permitted,investment- _ Reporting ' Client-specific policy grade corporate issues within the short-term area of the yield '""- ; parameter's loaded into curve. Portfolio maturities range from overnight in actively 'System training I - trading system managed cash portfolios to the I-10 year area of the yield curve for short and intermediate duration portfolios. 2lPublic Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • Statement of Work Required 5. Place all orders for the purchase and sale of securities,communicate settlement information to City staff and assist in coordinating security settlement. Security Recommendation and Execution Process Once the appropriate sector,duration,and maturity allocations are determined,Public Trust begins the portfolio construction and security procurement process.The selection of individual securities is based on the assessment of relative value and the analysis of each security's contribution to total portfolio risk and expected return. Public Trust recommends aggressively "shopping"for all securities to identify individual securities that provide the opportunity to add incremental yield relative to the market while controlling overall portfolio risks and assuring aggressive pricing. In general, we solicit all security transactions via a competitive process and maintain detailed records regarding the broker-dealers queried, their corresponding bids/offers, and the basis of transaction awards. This information is maintained for auditing purposes and available to each client upon request. We provide Several portfolio and security structures are evaluated across a range of potential market scenarios security specific to determine which structure provides for the most consistent risk-adjusted performance.Individual details and security trades are initiated and recommended by the portfolio management team consistent with explanation for each portfolio's stated objectives and constraints. Public Trust is in communication with numerous broker-dealer firms throughout the trading day and we continually shop for all securities to ensure every investment optimal pricing. Security trades may be executed over electronic trading platforms such as recommendation Bloomberg or conducted verbally with the participating broker-dealer. Further, Public Trust has for all City implemented systems that require the portfolio manager to review compliance statistics before any investment purchase or sale is executed and each trade is verified through our pre-trade compliance process portfolios prior to the recommendation and execution. Non-Discretionary Trade Procedures for the City of Miami Beach IS Identify upcoming maturities within each portfolio 7 Discuss maturities within each portfolio during monthly investment review , Confirm cash flow needs for each portfolio Prepare an investment recommendation based on cash flow needs and market opportunities • Confirm Pre-trade compliance • 1 Transaction recommendation delivered to the City for review and approval • Conduct follow up call for further analysis of investment recommendation when appropriate 71 Execute trade upon approval ' Obtain multiple quotes,when possible,in accordance with the investment policy through a competitive bidding process with the goal of achieving optimal pricing IT Trade confirmation is received and electronic trade ticket is generated g Security and cash position are simultaneously transferred—delivery vs payment ▪ Trade ticket provided to custodian for reconciliation settlement within the custody account 7 Trades are reflected online within the client's portfolio holdings; all portfolio statistics are updated based on previous day's trades to reflect current portfolio characteristics • Review all trades at following monthly meeting orkr Reporting Fmk.,Cr4ir qu o • FIH3,1,Ed PUBLIC' wn Kati Custody G,;y 0 Client Wan; TRUST rv' Account • • • Broker/Dealer Broker/Dealer; ;Broker/Dealer Competitive Bid 3IPublic Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 L Statement of Work Required 6. Serve as a general resource to City staff for information, advice and training regarding fixed income securities, investment and yield curve analysis. Public Trust will serve as a general resource to City staff for information, advice and training as discussed throughout this proposal. We will continue to provide the City with individualized training in-person and virtually for CPE certification. Knowledge is key to a Successful Investment Program Public Trust is committed to the training and education of our clients and the public sector in general.We believe this is a key component to the success of any investment program. We develop training programs based on current events, recent and upcoming GASB statements,and a variety of important topics related to the treasury management function including the development and annual review of an investment policy, implementing investment strategies, cash flow analysis, the roles within treasury management, banking services, auditing, arbitrage, bond proceeds investment strategies, and economic updates. Public Trust will continue to provide the City staff with considerable resources for training and education.We believe that a knowledgeable staff is essential to a successful investment program. Several of our professionals have extensive experience in fixed income asset management and regularly provide training and presentations for several government professional organizations related to the investment and treasury management of public funds. For our formal training sessions,we also include external professionals that cover several treasury-management related topics, including Certified Public Accounting firms to cover recent Governmental Accounting Standards Board(GASB)pronouncements,ratings agencies,arbitrage rebate consultants,and government professionals to provide a peer-to-peer discussion on industry-accepted best practices. Our Commitment to Training Certified CPE training U. Annual hybrid live/virtual training providing eight hours of CPE in accordance with Florida State Statutes 7,1 Onsite and virtual client specific training 7. Frequent speakers at the National GFOA,state and local GFOA chapters including the FGFOA 11 Partnerships with industry professionals to provide a broad spectrum of investment, GASB, cybersecurity, treasury, banking,and financial advisory related topics WEBINAR }r FEBRUARY25,2021 PUBLIC FUNDS INVESTMENT Longerrr Money estmentsand1.0P 1 SEMINAR Trends and Emerq.nq Risks ' Wednesday s 1 1i05TE08Y-I�tNlll.l(! July 22.10 Am.MT '! t'Lr)u allTTtl T _ tprtmTac wiTIM till 4nvs Laura Glenn,CFA Pctwk rueds investment Seminar - 4. rawv wt..,n ton t(j 0>.a 9..m emalt[t+ eMma+erwr wO.nervyq seen r.n ea,ns.w,mrn.vm«.vaw. "!,/:.� m..�eY,n er..v,.«%w..s:..-mr ,sae` •`Y Fostorine Diversity&Indusesn InToday World ..,........n.%V. Itweo>.nv wr.mu.ffm I q 1'Ul7t.(C ,».,,.e,.,n•t. ,.ra„ti,.®„,,,n�.,.� Training rem Oest Practices and Strategies for 7e Public Funds Investing n.r August 31-September 2,2021 eLearning Course 1:30-415 p.m.ET miTRii r John Grady Our approach to our training programs is to utilize professionals within each topic of the agenda that includes Public Trust professionals as well as other professionals and experts within other areas of public finance including government bankers, auditors,and actuaries for pension-related topics.We can design a tailored program for the City based on the specific areas of focus that are desired. Public Trust will commit to providing CPE training to the City staff onsite if needed. 4IPublic Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Statement of Work Required 7. Work with City staff to develop cash flow projections to ensure that the investment strategy is consistent with the City's cash requirements. Managing Liquidity: Cash Flow Fluctuations and Portfolio Strategies As a company focused 100%on the public sector,Public Trust is accustomed to working with our clients on an ongoing basis as forecasting and cash flows fluctuate. Most recently, Public Trust has been assisting its clients in adapting their treasury management in response to COVID-19.While the discussion varies by entity, reevaluating liquidity,assessing risk tolerance for commercial paper and corporate notes,and managing monies received through the CARES Act are examples of Public Trust's proactive approach due to fluctuating cash flows and forecasting. Our familiarity with the public funds investment programs provides Public Trust with a unique perspective that allows us to implement a customized strategy based on the investment objectives outlined in the City's Investment Policy.We believe that a cash flow analysis can improve the overall performance of a client's investment management program by identifying assets needed for very short-term needs (payroll), periodic (debt service), one time in and outflows (sale or purchase of land, grants), and longer-term assets (reserves, self-insurance). While a general approach to this process (such as knowing the lowest balance throughout the year) can be helpful, a deeper understanding of the timing of the cash flows can significantly increase investment options for the investment program.Even in the current interest rate environment,this may result in an increase in interest earnings that may be used to offset lower revenues from other sources such as ad valorem or sales taxes. We utilize a cash flow model that incorporates seasonality and estimates increases/decreases in fund balance based on this historical information.Since each public-sector entity has unique characteristics,there will be slight differences in timing and types of revenues and expenses. The knowledge that a cash flow analysis provides is important in any interest rate environment,though this approach can be especially beneficial in a rising interest rate environment by establishing a multiple duration approach to provide liquidity from overnight and short-term strategies and to seek to enhance income performance with assets identified for longer duration strategies. 8. Provide online real-time access to the City's portfolio that includes,at a minimum,the following information: a. monthly statements detailing investment activity and earnings, b. the value of the investment portfolio, c. portfolio return and monthly mark to market valuation d. weighted average maturity e. accrued interest by investment type f. rating of investment by Standards&Poor's and Moody's. Comprehensive Online Reporting Platform Public Trust offers our clients a comprehensive reporting platform with advanced capabilities that provide required industry standard information.This reporting technology also allows for supplemental investment reports that are client specific.We have recently launched the newest version of our online reporting platform that includes automatic"push"statement delivery and we are developing the next version that will provide an online portal that will have the E_ _PUBLIC` 1 capability to warehouse historical statements, invoices, the investment policy statement and � �TRUST other cash and investment related documentation all of which will be stored securely in a W ADVISORS password protected site. Specific Reporting Capabilities and Characteristics include: 1-11 Password Protected Online Access . Daily market value for Public Trust managed assets • Client Login Daily updated transaction activity risernarne Daily reconciliation to the custodian bars,Nord,,se„,z..,a Purchases,Sales, Maturities, MBS Paydowns, Interest Payments Password M Detailed securities holding report with CUSIP specific information , Enter Your Pasmemd Trade date,YTM,coupon,par,original cost,maturity,ratings aUnrealized/Realized gain or loss Log in GASB 40 statement disclosure ,,,y,,, ,IWON s. 5jPublic Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 li4 " 1 1 Statement of Work Required • Cash flow report detailing upcoming maturities and interest payments U Accounting reports to supplement internally generated reports 71 Quarterly and annual reports including market and economic information 'C3-LIC° ��,• mitTRUsT DASHBOARDS.. !MLOVOItl �.19 INV- ,SWEunCl]lN . • a.9 ----at 0 '+ nVlnn[la Adt-04 I_ t..i1.tigFistlll..mma o-aa?ntr - +IS 1 Ma9 .i Alatak•erw iYnfa9Bsax ,RenwfeUe,etwe a>m.%r ,timremear e.wnarn —_----. auurrz'. _ dv aaeu.rm.ea.•aa�aa • - _AI Aurraxt I0 - Ie..Ls. -_ - - _ Da Un....1Dr4M. - iejsin _YIMVA _1 AI eOSS P.hi!IW Low _ nw4 4elvlva.•t...o.a p13..9 .1i59 fmAtmee. tgaflFltlt finerlbbn elvC.ae!eem a IIeCle Cm !, Op Ofw I . 9W. .N fEeO NWV 1Wygn aeadem 1-S* het bfan Wm; It49 lavcat[a mt. "In Wes toE{.isMVWff I41 O.at - epb, f9GWCyna 'a40.aW a "looaas !when •O..reet9.Me.am,d.atin!OmpOP/e1 ef_a terms 140....ntmea Sear%!1'OO, - ih#antd M.pn S''n'R1,PT+1 W^.t1.,v- Y fJ...i' 0.00,0V1 .trwR6.)pI uJa...fq Iwcnn9e - .aomnf -' mea�a_ 1 ISLOCO MI Y EI,IN,IfS IS • i :AM OtO y IcDcR KV n a1.99afn - n0a-Ali Cr{-if. IIW-Ia, t0C-.LO Accurate,timely,and transparent investment reporting is an essential tool to confirm compliance and ensure internal controls are followed in accordance with the City's investment policy. As such,we provide online reporting that is updated daily as well as custom monthly,quarterly,and annual reports.We believe the information provided for verification is only valuable if it meets the criteria of being accurate,timely,and transparent for ease of understanding. Over the last two years, Public Trust invested more than$2.0 million in various information technologies,including our new enhanced proprietary report platform. Updates include a more efficient presentation of investment portfolio characteristics and data. More importantly, this new format provides higher security protocols by minimizing emails that may contain sensitive information. When the investment report has been reconciled, an email is generated to notify the user that the report has been generated. The user then logs in to the password protected site to download the report and/or view online. Detailed Monthly, Quarterly and Annual Reports The City will receive monthly,quarterly,and annual reports on all Public Trust managed assets.In addition,we will work with the City's team to develop an Asset Allocation report that provides details on Public Trust managed assets and investments managed internally including money market funds and LGIPs. All reports, regardless of the period reported,are prepared in the same format resulting in a more efficient approach to reconciliation,compliance verification and preparation of investment related journal entries. Z Summary of Investment Report Characteristics ✓ Cost, Book and Market Value ✓ Discussion on previous and future recommended ✓ Accrued interest investment approach I Earnings,Amortization and Net Income ✓ Review of all assets and overall treasury management program ✓ Realized/unrealized gains and losses ✓ Portfolio duration and maturity distribution I Review cash flow and liquidity needs ✓ Confirmation of short-and long-term investment ✓ Asset allocation objectives I Total return calculations ✓ Quarterly/annual formal presentation to elected I Market and Economic review and impact on officials portfolio strategy ✓ Security credit ratings T 6lPublic Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 MEM illiiStatement of Work Required Portfolio Characteristics Portfolio Summary I Summary 07/31121• 08/31/21 07/31121 o8131i21 Duration 1.846 2.12B HatoilcilCot $651,044,519.35 $664,968.182,06 'Years to Hiettne- .800kValue 649.712.748.28 663,371,058.66 attutity 1329' 1:409 Atmied Interest 1,674,69816 1,765,992.20 Years to Fatal Maturity 1338 1.418 .CauPonRate '1.032: -LI ,Net PEndrsgTransactioln 10,253;125.00 0.00 • 'Hook Value Phs'Accrued. - 5661,640,57155 3_665,137,050.86 Book'NW 0175 'd 0.853 0.606 MadQtY NetU Gain/Loss 5;797,075.21 5,182,55167 _031 8 M44v.alue PlosAicr4d ,5667.437.6.46.75; $670,319,60953 Income Summary Pealed Income Income Maturity Distribution by Type Inmgtmcane $577S73.03 50% Net Amort1ui o J.Awetion Income (107.786.31) 42.5% -Net/n'come. --- -__ $469• ,786:72 40% m CASH 0.00% 1111;- (♦ CORP 5.65% Transactions eVa-to:y.-a+r • IN GSE 19.46% 30% • MMFUND 34.94% Income 'rr� -sv:"1- I US GOV 39.96% Portfolio Activity Summary aLtrx.a.'.:'1t 20% - - GAS0.40 •r-.tr�vc.-.r- 14:2% • 12.2% 123% • . r� p.*µ yW. Ww.� 10% .�..-... 5.3% .e,. ..c n, r.aa.a 2.5°k V.... mrn 1.494! 0.3 3-6 6-9 9-12 1-2 2-3 3-4 4-5 5+ t .. Months Months Months Months Years Years Years Years Years '.". t® - ,., • ..�,..: ' Detailed Security Level Reports ' °- '" • `a__ _ ' -%. ,° ✓ Holdings ommoo�� ,. . . tar. ✓ Transactions • ..:..::'. . ✓ Income - w .> ✓ Portfolio Activity Summary • `"'" . -. - . ° ✓ Issuer concentration (GASB 40) ▪ _ . - '� = _ u; `mwe ✓ Ability to develop custom, user specific reports 1 Month end statements include: r Allocation by Standard and Poor's Rating Allocation by Moody's Rating ✓ Historical Portfolio Trends ff /, !-----. ✓ Changes in book and market yields during the period f �� ✓ Adjustments in asset allocation I.■ AAA 1.75% /C] • A 6 801% AA 95.78% • A 3.82% ✓ Portfolio characteristics comparison to selected benchmark ■ A z.a7% 9. The selected investment advisor must maintain accurate reports including portfolio composition showing diversity of investments and compliance with applicable investment policies of the City of Miami Beach and State of Florida Statutes. Public Trust will continue to maintain accurate reports that include portfolio composition, diversity of investments and compliance with applicable investment policies of the City of Miami Beach and Florida State Statutes. These reports are available online and can be downloaded anytime. 7IPublic Trust Advisors -City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Man Statement of Work Required I0. Develop and implement investment strategies for the Advisory Account that will seek to enhance portfolio performance under current and future market conditions within the parameters of the City's investment policy and cash flow needs. In 2015 when Public Trust began serving the City of Miami Beach,we worked closely with the Finance Team to develop a more efficient approach to the investment program. This included a more detailed, portfolio specific approach that involves more communication and coordination with the City's Finance Team. We believe this has been very successful and has resulted in an investment program that maintains a Safety-First approach,while also ensuring liquidity for short term operating expenses as well as cash flows for project expenditures from bond proceeds and capital project investment portfolios. One example of a successful strategy implementation was our recommendation to increase the duration of the Investment portfolio based on historical cash flows and balances as well as historical returns for various investment strategies. After review and discussion,the City's Finance Team approved the recommendation. This resulted in an investment portfolio that, even 18 months into the current zero interest rate environment positioned the City's investment portfolio to yield more than 1.0%above market,and still continues to provide more than 0.5%over comparable current market yields. While it is impossible to predict the movement of interest rates, historical risk/return profiles have been consistent over longer-term investment horizons. The decision to move the portfolio duration from 1.3 years to 2.1 years in 2018 has resulted in significant income protection when rates declined unexpectedly due to the COVID pandemic. We will continue to recommend strategies that are consistent with the investment policy statement, Florida State Statutes and that are within the City's risk tolerance. Our monthly investment reviews and other communications ensure funds are invested efficiently,with the goal of maximizing income within these parameters. We will also continue to confirm compliance with the monthly holding reports and through our online platform. When the City's cash balances,liquidity needs and/or risk tolerances change,we will make recommendations and adjust the strategy accordingly. This historical approach has resulted in the City's AAA rating on the investment program that is governed by an investment policy that is Certified and recognized by the Association of Public Treasurers(APT). I I. Obtain and document competitive prices for securities transactions. • As a fiduciary, Public Trust has an obligation to use its best efforts to seek and obtain the best available price and most favorable execution given the circumstances with respect to all portfolio transactions placed by the firm on behalf of its clients.This process is commonly referred to as"best execution".As part of our best execution process Public Trust evaluates broker dealers on a variety of criteria including but not limited to:(i)capital strength and stability, (ii)execution capabilities, (iii) trading expertise in fixed income securities, (iv) inventory of fixed income securities, (v) liquidity, (vi) any """`r z """"'(MIL) "`°""""�' transaction costs, and (vii) reliable and accurate a=wnre r.".rr: f""= communications and settlement capabilities. From the evaluation, Public Trust selects and maintains a list of „sU,_ ca,:{{, " ,t, • r:s .,..Y:,,:- brokers ("Approved Brokers") that are used for client "_ =ate._��__ _< «• t� Mir for r'" ",,:/_. transaction execution.To help ensure the firm is meeting , , � "f"lzr Irr" ,,,,,a:,; , �;,,�, ,,, its best execution obligations, Public Trust performs a "'"_""" 'S ' .."'"-:.f ``'" °` "' ',a1""'�"°` GY.tLq:Zs Or CI.uN=.{ID= WWI P . periodic (no less than quarterly) review of our trading f{"•=:ta practices and executions. r`'�`'r` 'u:`r'`'r' or'r` r r-sraT Mrs "r�` �'•" n.:.: W=:/R:. {6rC.C::.h, sec.:!.":f:. Sf. :.9firiCt 'LC:Rr To help ensure that Public Trust is meeting its best a: t,.1.11111 :,,b=>,= execution obligations for each client,the Chief Compliance mo• �• 4 tKf .f:,. P,",,," .• �s �_.•" ". I r. p.ab..r-a R.,.i:mA w.cn u. nr .+i :4 "14H." .<gb.a,.•s Officer(CCO)or a designee performs a periodic(no less than quarterly) review of the firm's trading practices, including a review of recommended custodians, brokers used for execution,trade costs,and any benefits received by the clients and/or the firms. Each review,including the findings and any necessary changes made to the practices will be documented and maintained in an appropriately designated file,along with all backup documentation,as part of the Firm's required books and records. Once the appropriate sector,duration,and maturity allocations are determined,Public Trust begins the portfolio construction and security procurement process. The selection of individual securities is based on the assessment of relative value and the analysis of each security's contribution to total portfolio risk and expected return. Public Trust recommends aggressively "shopping"for all securities to identify individual securities which provide the opportunity to add incremental yield relative to the market while controlling overall portfolio risks and assuring aggressive pricing. In general,Public Trust solicits all security transactions via a competitive process and maintains detailed records regarding the broker-dealers queried, their corresponding bids/offers, and the basis of transaction award. This information is maintained for auditing purposes and available to each client upon request. 8lPublic Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Nmasoaitiii 1 Statement of Work Required I2. Provide semi-annual and annual portfolio performance reports. Public Trust will continue to provide semi-annual and annual portfolio performance reports. GASB and Accounting Reports The City's Public Trust team has extensive experience developing GASB related reports including the GASB 40 note for the CAFR for several municipal public entities.A GASB 40 report is included in our standard monthly statement and is also accessible anytime online. The City's primary engagement team has developed GASB 40 reports that are specific to each client's CAFR note format. We have the capability to generate reports that allocate holdings for the CAFR table by maturity,asset class,and rating. These reports are easily downloaded and pre-formatted for inclusion into the document. The City's team will also assist with the CAFR GASB 40 note in the iac- Comprehensive Annual Financial Report (CAFR). John and Rod have I'IaITRUST extensive experience in assisting with developing the data tables and — — - information necessary to complete the CAFR note for several cities, including Miami Beach, and other Florida entities. We provide a GASB72 report report to each client at fiscal year-end. The GASB 72 report provides --�- = the Fair Value measurement for each security held at each input level. _ -=-T aft �- This report is customized to allow for price level confirmation at the — " CUSIP level. tg an =s : For summary reporting that includes all assets,we work closely with the - _ Eas, 47,1 City's staff and develop custom summary statements that also include " „ "' . internally managed assets with information provided by the City staff. _ , i ;- rEti John and Rod are also available to develop customized reporting for ® - - �* .� GASB requirements and other reporting requirements as needed and these reports will be available within each user profile. 13. Review and update the City's investment policy and written investment procedures. We believe the investment policy statement is the fundamental document that sets the foundation for the investment program. It is essential for an effective,compliant investment program that is based on a safety-first philosophy. Public Trust professionals have significant experience in the review, development and implementation of investment policy statements for public entities nationwide including county governments, school districts and higher education institutions, special districts, hospital districts, toll authorities, state agencies, and other entities responsible for the safe investment of public funds.Public Trust is intimately familiar with statutes governing the investment of public funds in Florida and has recently updated and rewritten investment policies for entities in Florida to reflect legislative changes to Florida statutes. In addition to reviewing our client's investment policy during the on-boarding process, we frequently provide training opportunities on the topic of investment policy development for state and local chapters of the GFOA. John and Rod present frequently on the topic of investment policy As part of our initial steps, we review our clients' current investment policy development at several state and statement and investment strategy, provide a full analysis, and suggest policy local public finance officers' recommendations. Our team of experienced investment advisory professionals provides comprehensive treasury management services that complement the organizations,including the GFOA services provided by Public Trust's portfolio management team. National Conferences in 2015, 2017 and 2018,2020 and During our annual review we propose updates based on our overall experience with 2021 each client, including changes in risk tolerance,cash flows, organizational structure, as well as local and state laws. While these types of changes are much more direct, The team supports the City and in many other circumstances, even just a subtle change in language can dramatically has developed numerous public impact the definition or intended parameters. Our experience in reviewing and funds investment policies in updating policies is an advantage for our clients in understanding the wording and several states,including the state confirming the intent and meaning of the language and making recommendations for of Florida. policy updates. 14. Coordinate and pay any fees associated with rating agencies for the annual rating review and certification of the City's investment policy. Public Trust will continue to coordinate and pay any fees associated with rating agencies for the annual rating review and certification of the City's investment policy. 9jPublic Trust Advisors -City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 NiStatement of Work Required 15. Perform due diligence reviews of current and proposed broker/dealers. Public Trust Advisors maintains an approved broker-dealer list that is monitored and updated on a quarterly basis. Each broker-dealer's professional background and standing with the Financial Industry Regulatory Authority(FINRA) is reviewed and the strength of each counterparty is assessed. As part of Public Trust's best execution process, we evaluate broker- dealers on a variety of criteria, including, but not limited to, execution capabilities,trading expertise, inventory,transaction costs, communication, and settlement capabilities. All brokerage firms must be primary dealers (trading counterparties of the New York Fed) or dealers registered with the Securities and Exchange Commission complying with Rule I5c3-1, also known as the Uniform Net Capital Rule. Rule I 5c3-I requires companies operating as brokerage firms to maintain a minimum of net capital to meet their financial obligations to customers and other creditors. In connection with the selection of such brokers,dealers and counterparties,and the placing of such orders,Public Trust Advisors seeks the most favorable execution and price "best execution," as described more fully in Form ADV Part 2A. Public Trust provides all clients, no less than annually,an updated listing of its approved broker-dealers. 16. Monitor the creditworthiness of the City's depository and custodian bank and investments in the portfolio. Public Trust has an in-house investment research department staffed with four professionals from various disciplines within the fixed income sector. Our research staff is strategically assembled to ensure deep expertise in critical areas such as fundamental analytical research and proactive risk management.Our team of skilled analysts leverage extensive professional experience in various investment arenas to uncover unique insights. These professionals draw on a deep reservoir of experience earned in the mutual fund,banking,investment banking,and regulatory sectors. Our in-house systems provide significant information that is used during our credit review process and ultimately for our security selection and maturity decisions.While much of our credit research and proprietary credit modeling capabilities are generated internally,the credit team supplements our internal research with industry-leading external research platforms and sophisticated risk management technology.The combination of in-house research and external sources,including S&P Global Ratings and Bloomberg,provides additional data and information for our modeling and valuation.Our firm structure provides for ongoing,informal credit research discussions between our credit and portfolio management teams. Credit Research Assignment Initially, Public Trust's head of credit research assigns a research request to an analyst who is charged with developing a fundamental research report and credit grade,independent of external influences,based upon corporate and regulatory filings and disclosures. Once completed, the analyst's initial research and grading is vetted through additional critical reviews, beginning with a reconciliation of the analyst's internal credit view against the credit opinion of the NRSROs and third-party debt and equity research available on the primary investment banking industry research portals.Any outstanding questions or incongruent views are then discussed with the subject issuer or corporation.Once these layers of vetting are completed, the assigned analyst presents the initial credit opinion to the other members of the credit department for another round of review.Next,the credit review and proposed internal credit grade is presented to Public Trust's credit committee,consisting of all the portfolio management and credit team members,the chief compliance officer,and two additional members who are independent of the portfolio management and credit process. If approved by the committee, the proposed issuer is then added to Public Trust's approved list of issuers and the credit is available for acquisition by Public Trust's portfolio management team. Utilizing publicly available data from a wide variety of sources(annual reports,earnings calls,economic data,etc.),the credit team thoroughly analyzes companies to understand both the current and projected performance of investments.This analysis shapes a wide-ranging discussion that covers the 5 C's of credit used to gauge the creditworthiness of potential borrowers: character,capacity,capital,collateral and conditions. Credit Research Approach We believe our credit research approach is unique due to our singular focus on the fixed income markets for public sector clients.All our investment programs adhere to the same primary objectives of safety,liquidity,and yield,and all the assets we manage and provide administration/advice for are fixed-income portfolios consisting solely of public funds. This allows our team to develop a firm-wide mission and approach while also implementing a client-specific strategy based on each client's investment policy guidelines and governing regulations.We believe this helps to minimize the risk of recommending a strategy that is not appropriate for public funds clients while providing the opportunity to utilize our credit research, portfolio management,and credit philosophy for all our clients nationwide.Our credit philosophy is described below: Strategic—The credit team confers daily with the portfolio management team to formulate ideas; constant, daily dialogue among team members generates risk-managed trade potentials 10jPublic Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 f ISO Statement of Work Required • Analysis—Unique, proprietary,analytical models built around financial statement analysis combined with industry and rating agency research to inform our in-depth research reports; daily monitoring of company releases, news items,and industry research to update opinions around the credit health of each issuer considered for portfolios • Fundamental—The credit team performs detailed work on each issuer including gathering information from face- to-face meetings; in-depth, rigorous analysis of company filings and reports;and conversations with customers and suppliers of issuers. Each report contains enhanced due diligence items that the analyst has flagged to monitor over the next year until the next detailed report is produced;these items are updated every quarter,and any changes to the risk management of the issuers are addressed by each analyst at that time Evaluation-Every issuer is vetted through the Credit Committee.The Credit Committee votes on the inclusion of issuers as well as changes to any risk management-based hold code or internal code based on the analyst's work; the Committee consists of the credit team,the portfolio management team,and the chief risk officer Each investment counterparty is vigilantly monitored, and every issuer's credit fundamentals are thoroughly analyzed and debated at least once a year by the credit and portfolio management teams during credit committee meetings. The credit committee process ensures that analysts have considered all possibilities and asked all necessary questions.The end result is an investment set made up of the highest-quality counterparties. Every credit is vetted before the Credit Committee and a majority must vote to add the name to the appropriate approved list.The credit team imposes tenor and concentration limits by sector,geography,and individual issuers,resulting in diversified and thoughtfully developed investment opportunities. All the credit team's processes and tools have been developed with the sole purpose of protecting client capital.This means thoroughly analyzing and debating potential investments and having the analytical tools to understand and act before a downgrade occurs. Credit Review Process Our process involves utilizing market and macro condition observations to capture relative value where opportunities may exist to improve yield within the risk parameters. This creates a list of suggested names to research on which our credit analysts perform fundamental analysis. They utilize company financial statements and their experience in analyzing certain metrics around these financials. • Profitability metrics- Returns on equity and assets, margins, segment profitability, and the reliability of certain types of revenues are metrics used to gather a sense of the volatility in earnings and margins • Capital levels—Tier one capital ratios, debt-to-assets, debt-to-equity,and free cash flow debt coverage give the analysts a comprehensive view of the cushions and levers that are available for the management team within the companies' balance sheets to weather the inevitable downturn in their operating environment • Liquidity and Cash Flow Metrics— Debt-to-earnings ratios; cash flow to interest expense; loans to deposits; liquid assets to total assets; and debt-to-free cash flow are examples of liquidity metrics. The analysis provides an understanding of the liquidity within the financial statements of the companies. A thoughtful analysis of the liquidity of the securities that Public Trust is contemplating purchasing is also performed including the number of dealers on a program or name,frequency of trades,and bid-ask spread analysis • Asset quality— Non-performing loans to gross loans; net charge-offs to total loans; loan loss reserve to non- performing loans; non-performing loans to total assets; and loan loss reserve to net-charge offs are examples. This area is analyzed to assess the ability of management to underwrite their balance sheet and prepare for any problem assets Our analysts utilize SEC filings, Wall Street research providers, credit rating agencies and Bloomberg to gather financial information as well as monitor ratings and news alerts on the specific credits.They also use external credit research platforms, rating agencies releases,company websites for financials and reporting events,and the general media for their analysis. Additionally, the credit team observes the global and domestic macroeconomic environment as well as the competitive environment for the companies being analyzed to determine suitability for the investments. The analysis focuses on performance given the business cycle as well as the changing legal and regulatory operating environments.There are constant reviews of issuer concentrations and NRSRO's ratings of the companies,as well. Regarding banking counterparties specifically, Public Trust utilizes a third-party bank rating service that provides our team with daily bank insight that includes industry news, earning and dividend announcements, executive changes, and other news. This service is also a resource for which we have access to specific bank ratings based on categories including liquidity and financial stability based on specific factors within the banking/financial services industry. II 1Public Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Statement of Work Required Risk management at Public Trust is an enterprise-wide process that is underpinned by formalized policies and procedures. Public Trust painstakingly developed our risk management system to protect and support our client's interests by covering the actual activities in which we are engaged and risks to which our operations and investments are exposed.By customizing our risk management system to our actual business practice,and implementing it on a firm-wide basis, Public Trust believes we have mitigated the most commonly unmanaged risks which LGIPs and SMAs have been exposed during previous business cycles. I7. Provide training on investment management subjects and guarantee minimum 8hrs of CPE in person or virtual training,at the sole discretion of the City,in accordance with Florida Statue 218.415. We offer multiple training options throughout the year including our annual investment seminar, participation in FGFOA chapter training and client training. We also provide training specifically to the City's Finance Team to ensure the 8 hours of CPE required by Florid State Statute 218.415 is fulfilled and we provide a Certificate of Completion for audit purposes. Our Commitment to Training ▪ Individual training opportunities for the City of Miami Beach 1g Certified CPE training a Annual hybrid of live/virtual training providing eight hours of CPE in accordance with Florida State Statutes Onsite and virtual client specific training ▪ Partnerships with industry professionals to provide a broad spectrum of investment, GASB, cybersecurity, treasury, banking,and financial advisory related topics 18. Provide,real-time access to the City's portfolio via an Online Web Based Reporting System accessible by the City. The City currently has real-time access to the City's portfolio via our online reporting portal. All authorized users will have individual log in and passwords with unique reporting options. 19. Attend meetings with the City's finance staff and governing body upon request,and Client Communication The Public Trust investment team is in frequent communication with the City regarding upcoming cash flows from interest payments and trades in the portfolio. We also recommend periodic discussions regarding existing holdings and recommended trades based on changes within the markets(e.g.,yield curve shifts,and sector spread changes). We are committed to continue providing monthly investment and market update reviews with the City's finance team and, when appropriate, conduct in-person visits with the City for quarterly investment meetings based on the City's requested schedule.We also will continue to discuss an in-depth review of portfolio strategy,benchmarks,composition,market outlook, etc.during our investment reviews. We understand the importance of a timely response to client requests.For client calls and inquiries,our goal is an immediate response and to provide a solution and/or the requested information as soon as possible. Our firm's team approach across the organization was developed specifically to allow for a quick response from a knowledgeable professional. Our structure provides for direct communication with several individuals which are familiar with the City's investment program.This includes the relationship managers, portfolio managers, client service team,access to the credit team and our chief compliance officer. The team structure of the Public Trust's client relationships allows for quick responses to a variety of requests including but not limited to reporting,audit information,compliance,trade ticket and portfolio and security level verification.This structure allows for quick responses to client requests that may require the development of custom reports to meet specific client needs. The City has direct contact information for John Grady and Rod Bettini to ensure a quick response. 12jPublic Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2CO ji Statement of Work Required Common Types of Client Communication • Trade recommendations for review and approval for In-Depth Review non-discretionary portfolios of Investment Program • Monthly conference calls for market and portfolio updates • Economic Updates with relevant fixed income data Cashflow and points Comprehensive Investment Policy Review and Update Review • Monthly reports and custom reports for internal and external uses11) • Responses for client specific requests(custom reports, historical data,market information) Trades/Compliance Collaborate on Review Strategy • Quarterly reviews with investment portfolio Development performance and investment strategy //"/ • Annual training in Orlando and client specific trainingInvestment • to meet Florida Statute requirements Strategy Development 20. Facilitate and fund arbitrage calculations and reports on the investment of bond proceeds. Public Trust will continue to facilitate and fund arbitrage calculations and reports on the investment of bond proceeds through • our partner, BLX Group. 13IPublic Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A0S4C7-63AF-4907-924A-8E3C31B1A2C0 Tab2 b 2 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 2. Experience and Qualifications 2.1 Qualifications of Proposing Firm Submit detailed information regarding the relevant experience and proven track record of the firm and/or its principals in providing the scope of services similar as identified in this solicitation,including experience in providing similar scope of services to public sector agencies. Three (3) of which must be governmental accounts. For each project that the Proposer submits as evidence of similar experience for the firm and/or any principal,the following is required:project description,agency name,agency contact,contact telephone &email,and year(s)and term of engagement, and amount of domestic fixed income assets being managed. For each project,identify whether the experience is for the firm or for a principal(include name of principal). Founded in September 20I I, Public Trust has grown from a small niche player to an established investment firm with more than $5I billion in assets under management as of June 30, 2021,serving public entities in 16 states nationally. Our goal,to provide high-quality services at a competitive cost, striving to help local governments like the City maximize investment income while providing more resources to assist and serve your local community. Public Trust is headquartered in Denver, Colorado,with offices in Florida,Arizona, California,Georgia,Michigan, New York,Ohio,and Texas. For more than 20 years, public sector entities have trusted the professionals at Public Trust to provide investment management and advisory services for their liquidity,operating,reserve and bond funds while first considering the safety and liquidity of the funds under management. Public Trust's experienced and well-resourced team combines significant portfolio management experience and robust credit research analysis to structure portfolios that meet each client's investment objectives and enhance the potential for higher returns. Public Trust has the size and scale to offer our clients significant resources, technology, and investment expertise. At the same time, Public Trust provides highly personalized service by investing the time to develop meaningful, long-term relationships with each client to fully serve and exceed their need's and expectations. Miami Beach and Florida Public Funds Investment Experience The Public Trust team,in partnership with the City's Finance Team,has successfully navigated the City's investment program through multiple economic cycles and interest rate environments including the credit crisis of 2008-20I0,and more recently during the COVID-19 pandemic and the 2020 economic recession. Originally since 2003,and currently since 2015 we have worked closely with the City to ensure safe investment strategies in stable,and in volatile market scenarios,the investment program has remained safe and the City has had ample liquidity to meet all cash flow needs. This dynamic,yet disciplined, investment program has been based on the City's unique cash flows,risk tolerances and investment objectives. This approach has resulted in a diversified, highly rated investment program. For confirmation of this achievement, Public Trust coordinated with the City's Finance Team and requested a rating for the investment program. The City was awarded a AAA rating from S&P. This rating has been confirmed annually since 2018. In addition to the AAA rating, following the most recent update to the City's investment policy statement that was approved by the City Commission in December 2018,the City was awarded the Association of Public Treasurer's Investment Policy Certification, confirming the City's investment policy follows a nationally recognized investment policy format that meets stringent requirements for a comprehensive policy for public funds investment management. From a statewide perspective,the team of Public Trust professionals who serve the City have had the opportunity throughout their careers to partner with more than 50 Florida public sector clients including Cities, Counties, Water Management Districts, Hospital and Health Care Districts, K-12 and Higher Education,Airport Authorities,and other Special Districts. These individuals have supported client relationships from the initial review phase to the recommendation and approval process for over two decades. We have implemented and successfully managed our clients' investment programs during virtually every interest and economic environment during this time, including the declining interest rate environment from 2004-2006,the Great Recession and Financial Crisis that began in 2007,the seven years of Zero Interest Rate Policy from 2008-2015,the rising interest rate environment from 2015-2018,and more recently,the declining rates that began in 2019 and ultimately returned to a Zero Interest Rate Policy in March 2020 as a result of the COVID-19 pandemic and economic lockdowns. We maintain close communication in any interest rate and economic scenario to ensure each client investment strategy is consistent with established goals and objectives. 3IPublic Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 2. Experience and Qualifications The following tables list our Public Trust team's current and historical Florida experience: Public Trust Team's Current Florida Public Fund Clients ▪ City of Miami Beach City of Tampa a Naples Airport Authority City of Hollywood a City of West Palm Beach Tampa-Hillsborough Expressway Authorit a City of Coral Springs o City of Stuart a School District of Lee County • City of Tamarac a City of Plant City Southwest Florida Water Management City of West Palm Beach a Village of Wellington District a City of Daytona Beach m Hernando County a St.Johns River Water Management ▪ City of Naples IT Pinellas County District M City of Cape Coral a Emerald Coast Utilities Authority a Health Care District of Palm Beach • City of Cocoa M Greater Orlando Aviation Authority County M City of Leesburg Additional Public Trust Team Florida Public Fund Experience City of Aventura a Alachua County Broward County Schools a City of Hallandale Beach Hillsborough County Tr, Miami Children's Hospital Orange a City of Jacksonville Beach Leon County a Orange County Tax Collector . City of North Port 2 Marion County a South Broward Hospital District a City of Palm Coast g St.Johns County a Sarasota Memorial Hospital ▪ City of Pompano Beach Manatee Schools ff Citizens Property&Casualty a City of Ocala a Lake County Schools a State of Florida VI City of Sanford a Palm Beach County Schools a Town of Davie City of Tallahassee a Seminole County Schools CCity of Vero Beach Partial Client List Disclosure The above information is a sample list of current Public Trust clients and entities that Public Trust professionals have provided investment advisory services to during their careers. These entities were chosen based on service offering investment objectives,or geographic location. This list should not be considered a recommendation or an endorsement by any client of Public Trust or the investment advisory services provided by Public Trust. It is not known whether the listed clients approve or disapprove of Public Trust or the services the clients receive from Public Trust National Public Agencies Treasury Program Experience The Public Trust team of professionals dedicated to the City has significant Florida (and national) experience in providing overall treasury management services,with a specific focus on providing investment management and advisory solutions to cities, counties, higher education, and special districts. To support our clients' treasury management functions, our team includes individuals with experience spanning more than four decades through multiple interest rate cycles. a Portfolio Management a Training I Full discretion if Full day 8-hour CPE sessions I Non-Discretionary ✓ Topic specific on-site training capabilities I Separately managed accounts (SMAs) ✓ In-person and virtual web-based training ✓ Local government investment pools(LGIPs) Client communication focus a Treasury management I Ongoing informal and formal discussions ✓ Investment Policy Development ✓ Quarterly meetings and annual presentation ✓ Cash flow analysis to investment committee/elected officials ✓ Daily cash management support and report12 Accounting and reporting development ✓ Full reporting transparency ✓ Banking and custody RFP services development I Tailored reports ✓ Available internal/external reporting ✓ Economic and market commentary 4jPublic Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 speasatal 1 2. Experience and Qualifications Relevant Public Funds Investment Experience • Firm and Principals(John Grady)have served the City of Miami Beach from 2003- 2012,and 2015-Current MI AM I B EAC H i Provide investment advice for liquidity and core investment assets • A diversified investment program of 18 individual portfolios that are managed John Woodruff,CFO independently based on sources of revenues and timing of expenditures Johnwoodruff@miamibeachfl.gov 0, Monthly Teams meeting calls to provide market and portfolio strategy updates 305-673-7466 Sara Patino,Treasury Manager 7. Non-discretionary advice:Trade recommendations with transaction details for review sarapatino@miamibeachfl.gov and pre-approval 305-673-7000 ext.26497 3 Applied for and received the Association of Public Treasurers'of the U.S.and Canada's Finance Department Investment Policy Certification 1700 Convention Center Drive,Miami Beach,FL 33139 Tr Ensure the City's investment program is managed to adhere to the criteria to maintain the AAA rating by Standard and Poor's'(S&P) ▪ Annual training in person and virtual to meet the requirements of Florida State Statutes Firm and Principals(John Grady)have served the City of Coral Springs from 2005- 201.2,and 2017-Current CORAL SPRINGS t Provide investment advice for liquidity and core investment assets —v,,,.Uts..3 0i...,.sum— V. A diversified investment program of 2 individual portfolios that are managed KIM MOSKOWITZ,CPA,City Controller independently based on sources of revenues and timing of expenditures Financial Services 71 Quarterly investment committee meetings to provide market and portfolio strategy kmoskowitz@coralsprings.org updates 954-344-1092 • Discretionary investment portfolio for core and reserve funds 9500 West Sample Road Coral Springs,FL 33065 1 Online reporting platform with enhanced month-end statements • Annual training in person and virtual to meet the requirements of Florida State Statutes 11 Firm and Principals(John Grady)have served the Village of Wellington since 2017 THE VILLAGE OF i ELLINGTON u Provide investment advice for liquidity and core investment assets Ti A diversified investment program of 2 individual portfolios that are managed Tanya W.Quickel Independently based on sources of revenues and timing of expenditures Deputy Village Manager Quarterly investment committee meetings to provide market and portfolio strategy tquickel@wellingtonfl.gov updates 561-791-4113 12300 Forest Hill Boulevard 7, Discretionary investment portfolio for core and non-discretionary for capital projects Wellington,FL 33414 11 Online reporting platform with enhanced month-end statements to Annual training in person and virtual to meet the requirements of Florida State Statutes T. Firm and Principals(John Grady)have served the City of Naples from 2005-2012, cad al and 2012-Current a Qcs Florida 17 Provide investment advice for liquidity and core investment assets A diversified investment program of an Aggregate investment portfolio that is Jodi Bain managed independently based on sources of revenues and timing of expenditures Senior Accountant • Quarterly investment committee meetings to provide market and portfolio strategy jbain@naplesgov.com updates 239-213-1816 Finance Department 71. Non-discretionary advice:Trade recommendations with transaction details for review 735 8th St.5 and pre-approval Naples FL 34102 Online reporting platform with enhanced month-end statements IT, Annual training in person and virtual to meet the requirements of Florida State Statutes 5IPublic Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Ell2. Experience and Qualifications 2.2 Qualifications of Proposer Team Provide an organizational chart of all personnel and consultants to be used for this project if awarded, the role that each team member will play in providing the services detailed herein and each team members' qualifications. A resume of each individual, including education, experience, and any other pertinent information,shall be included for each Proposal team member to be assigned to this contract. The City is served by an experienced,knowledgeable team and will have direct contact to the project team members. While other firms provide a single contact or a help desk,at Public Trust we provide a team of professionals that will be intimately familiar with each client relationship. The primary engagement team,and a description of their roles and responsibilities are presented following the organizational chart. The following organizational chart shows the team that will serve the City: City of Miami Beach Portfolio Investment Admiiistration4_ Client Services& Credit Research Compliance Management Advisory Marketing Accounting Cory Gebel,CFA John Grady Christa Kronquist Barry Howsden Director Kevin Berenu Managing Director Tom Jordan,CEO, Director of Chief Compliance Portfolio Chief Risk Officer Partners Partner Operations,Client Officer Management Credit (Primary) Services Compliance Rod Bettini Stephen Dixon Mark Creger Sean Fitzgerald Director of Director Portfolio Senior Credit Director,IA Todd Alton, Jennette Gosselin Business Management Analyst Services and Sales President VP Client Relations Operations (Primary) Compliance Marcelo Alaniz, Neil Waud CFA Thomas Tight Sandra Fitzgerald Audrey Parker Chief Investment Managing Director Client Services Officer Senior Credit Partners COO,Operations Supervisor Analyst Joe Carroll Patrick Edler,CFA Matthew Tight Tegan Kmack Randy Palomba, Credit Research VP Chief Lead Fund CFA,Partner Analyst FL CLASS Development Accountant Officer Manuel San Luis Tommy Jordan Danielle Campbell VP Portfolio Regional Director Client Services Management FL CLASS Associate Carter Genoar Tiffany Singh Shoshana Zohari Credit Trader Investment Analyst Client Services Operations Associate Aaron Joseph Trade Operations • Joe Primiano Associate VP,Finance Nick Palomba Accountant We work closely with our clients'treasury and investment staff in the development and annual review of investment policy statements, internal controls procedures, cash flow analysis, liquidity and short-term investment strategies (money market funds, overnight investments), and core portfolio strategies for assets invested longer than a year (fixed income securities, portfolio structures). The Public Trust team also has considerable experience in analyzing investment strategies for bond proceeds,and we currently manage several investment portfolios for the City's outstanding bond issuances.This all-encompassing approach to investment and portfolio management services has resulted in the City's efficient,successful investment program. 6lPublic Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 5 � 2. Experience and Qualifications John Grady,Rod Bettini and Tiffany Singh will serve as the primary contacts for the City their responsibilities include: r— n17. l( John F.Grady Tiffany Singh Rod Bettini Managing Director Investment Analyst Director 23 Years Experience 4 Years Experience 12 Years Experience 71, Serve as an extension of City staff for investment and treasury related duties and responsibilities Monthly meetings to confirm strategy and provide updates regarding investment portfolio structure 7. Meet in person with the City for quarterly reviews that include an economic update,yield curve analysis and portfolio review • Present to the City Council as requested Provide daily cash and treasury support to the City Develop and update a cash flow analysis to confirm appropriate allocation of financial assets within the City's longer term core portfolio,and assets designated for short-term portfolio. • Assist with recommendations for investment options for the City's overall investment program and coordinate with the City with LGIP investment options to ensure appropriate liquidity for short term expenditures • Annual review of Investment Policy Statement and other financial policies as needed • Support for banking,,custody,and other treasury related services Portfolio Manager Cory Gebel,CFA,Director,and Neil Waud,CFA,Chief Investment Officer at Public Trust serve as the City's portfolio manager and their responsibilities include: ti„s, Cory Gebel,CFA Neil Waud,CFA Director Chief Investment Officer • Serves as the City's primary portfolio manager • Coordinates with the Primary relationship managers to ensure the City's investment program is managed efficiently • Daily management of the City's investment portfolio to ensure compliance with the Investment Policy Statement and Florida State Statutes '11 Participates in monthly investment reviews and Council presentations and provides portfolio manager perspective and details regarding portfolio strategy and performance Determines security selection based on Investment Policy parameters, market conditions, asset class and security availability u Ensures investment transactions are executed and settled;provide trade tickets to the City 3 Prepares analytical information on portfolio structure and strategy 7IPublic Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 j <,i 1011 1 2. Experience and Qualifications Client Services and Accounting Team Christa Kronquist,Jen Gosselin,and Audrey Parker are the City's Client Services and Accounting Team and their responsibilities include: Christa Kronquist Jennette Gosselin Audrey Parker Director,Client VP Client Relations Client Services Services Supervisor 7. Coordinate the onboarding process and client relationship communication protocols Support the Advisory and Portfolio teams with operational client requests to ensure timely solution . Monthly custody statement and Public Trust investment report reconciliation 7.4 Verify online access and password authentication ▪ Provide accounting and journal entry support Generate historical information for annual audit requests The Public Trust Credit Committee: F An in-house,independent team solely dedicated to the credit research function V. Only issuers evaluated and approved by the Credit Committee are permitted for investment in our client portfolios 7, Proprietary model for quantitative analysis that surpasses a simple matrix-based approach ▪ Provides internal and external qualitative approach to support the financial analysis output 7. Performs initial and ongoing in-depth reviews of all approved issuers The Public Trust Compliance Team: 73 Ensures compliance during onboarding process and during periodic reviews iy Confirms communication,on-line access and other necessary access is accurate and up to date 7, Verifies portfolio compliance rules for pre-and post-trade • Provide internal and external qualitative approach to support the financial analysis output U Maintains all records related to our GIPS®compliance • Review client investment agreements for compliance with Securities and Exchange Commission requirements Complete Biographies can be found in Appendix E. 8lPublic~Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 otwve 2. Experience and Qualifications 2.2.1. Account Manager Identify proposed account manager with at least ten (I 0)years of experience providing investment advisory services,of which,at least five(5) must be providing investment advisory services to public agencies. Include a resume which includes education,years of experience,and any other pertinent information. John Grady, with more than 23 years of public finance and investment experience will continue to serve as the account manager. The City will continue to be served by a team of primary engagement managers. This team approach is designed to ensure a high level of client service with quick response times and knowledgeable professionals in all areas of the firm. John Grady-Managing Director& Partner 23 Years of Public Finance and Investment Experience 71 Seasoned in public funds investment program development and implementation with a full- scope treasury management approach;experienced in public finance debt transactions and bond proceeds investment strategies; development of cash flow models; and creating investment reports to meet industry and client-specific requirements • Frequent speaker for the national,state,and local chapters of the Government Finance Officers Association (GFOA) 2 Member of the GFOA's Committee on Treasury and Investment Management(TIM) u Bachelor of Science in Business Administration in Finance and Insurance with a Minor in Economics as well a Master of Business Administration from the University of Florida Cory Gebel, CFA, Director, Portfolio Management 23 Years of Public Finance and Investment Experience Experienced portfolio manager with an expertise in designing,implementing and communicating institutional fixed income strategies for municipalities ▪ Member of credit committee,which leads to informed security selection decisions Bachelor of Arts in Accounting from the University of Northern Iowa and CFA Charterholder Rodrigo Bettini-Director, Investment Advisory Services 12 Years of Public Finance Experience ▪ Responsible for business development and client relationships across the state and providing clients with technical and analytical resources for treasury management and investment strategies ▪ Featured speaker at regional, national,and global conferences for many organizations including the GFOA • Bachelor of Arts in Marketing from the University of South Florida and a Master of Business Administration from the University of Florida 9 ' Public Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Tab3 b 3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 EH 11 3. Approach and Methodology Submit detailed information on how Proposer plans to accomplish the required scope of services,including detailed information,as applicable,which addresses,but need not be limited to: • how proposer plans to accomplish the required scope of services; • proposer's understanding of public investment requirements,constraints on arbitrage regulations, and all other applicable matters; • details on Proposer's web-based investment reporting and customer access system; • details on any cost savings; • any other related value-added services that Proposer is offering;and • any cost reduction proposals that the proposer is offering. Our Approach to Accomplishing the City's Investment Advisory Scope of Services We will continue to support the City's investment advisory engagement through full commitment of our client-focused team of investment management professionals.We emphasize building strong relationships with our clients to gain an understanding of the cash flows, investment objectives and risk tolerances for each client. We believe this approach has resulted in an effective investment program for the City that is structured with the goal of seeking to enhance returns as a result of more efficient, cash flow driven, investment strategies. In our opinion,this is achieved through a healthy amount of communication, an understanding of the sources and uses of revenues and ongoing Please also refer discussions regarding the investment program. Public Trust's team of professionals that serve the to the following City include John Grady, the primary relationship manager and Cory Gebel, CFA the primary section for portfolio manager. These individuals,and all of the Public Trust team members,are dedicated to the success of the City's investment program. detailed responses to the 20 required Understanding the City's Investment Objectives for a Compliant Investment Program services as We believe a client communication-focused partnership results in a more efficient and fully compliant presented in the investment program. We have a deep understanding of the City's investment program having worked Statement of closely with the Finance Team to update the current Investment Policy Statement that defines the Work Section in investment objectives, permitted investments and maturity limitations designed to ensure a safety- the City's RFQ. first approach to the management of the City's financial assets. To ensure the City's investments are appropriately invested,John,Cory and Rod meet with the Finance Team on a monthly basis to review the overall investment program and the strategy for each individual portfolio,including recent and upcoming maturities,timing of cash flow needs. We also discuss market and economic conditions that impact the fixed income markets and how these factors reflect our investment recommendations. The following paragraphs provide a blueprint to our approach for the City and all of our client investment programs. Complete Initial and Ongoing Review of the City's Investment Program As an initial step in our relationship with our clients, we seek to understand the roles and responsibilities of the client's finance and investment team and specific goals of the client's treasury management program. From there, we construct a policy and investment program that is compliant with state and local laws;is in line with the risk tolerances of the client;and meets the minimum requirements in the areas of asset allocation and maturity requirements, reporting, benchmarking, internal controls and investment procedures, and competitive selection of investments. This approach has resulted in an investment program that ensures the City maintains the primary objective of safety of principal and an investment program that is compliant with the City's investment policy and Florida State Statutes. The ongoing review and communication ensures appropriate amounts of liquidity for short term expenditures, while investing core assets in highly-rated,liquid fixed-income investments. Our investment philosophy is based on the safety principle of protecting the public funds Portfolio we manage on behalf of our clients. Our use of diversification and pre-and post- Management trade verification minimizes market value volatility, prevents exposure to noncompliant securities within the portfolio, and provides complete transparency to the strategy and holdings of the portfolio daily. By adhering investment credit to these principles, our goal is to provide strong, risk-adjusted returns.We °r1vinry Research provide discretionary and non-discretionary asset management based on revenue type,investment objectives,and the characteristics of each client. MIAMI REACH Our approach to providing investment advisory services is to be considered as an internal resource for the clients'staff.We believe this enhances our clients' cash and investment management programs through greater efficiency and Operations tipliance effectiveness. We only manage fixed-income assets for our public entity clients. Accounting L Our portfolio managers' expertise is in managing portfolios consisting of U.S. _ 10IPublic Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 I I la/0 3. Approach and Methodology Treasuries, Federal Agencies, and, where permitted, investment-grade corporate issues within the short-term area of the yield curve. Portfolio maturities range from overnight in actively managed cash portfolios to the I-10 year area of the yield curve for short and intermediate duration portfolios. Strategies for the Value-Added Approach to Portfolio Management Our portfolio management and credit teams coordinate with the investment advisor and client to determine the optimal approach based on our initial and on-going client reviews. We avoid market timing strategies due to the inability to predict future interest rates,shifts in the yield curve and other economic and geopolitical events that impact the fixed income markets. Rather, we apply qualitative and quantitative methods for portfolio management with the goal of adding value to the investment program versus a purely passive investment approach.These methods allow the portfolio managers the ability to adjust the portfolio structure and asset allocation based on current information and forecasting,while maintaining a disciplined approach regarding the targeted duration Duration Management: After considering each client's liquidity preferences and tolerance for market price volatility, Public Trust establishes a target portfolio duration which may be expressed in absolute terms or relative to a stated benchmark. Starting with the target duration,portfolio returns can be enhanced by making constrained and prudent changes to portfolio duration relative to the interest rate outlook. We apply duration management strategies through reinvestment recommendations based on the liquidity needs of each individual investment portfolio. For example,the City's Investment Account portfolio assets are designated for reserves and long-term expenditures which allowed for a duration of 2.13 years as of August 3 I't. Several of the City's bond proceeds investment portfolios have shorter durations to provide liquidity for short term project expenditures. Yield Curve Positioning:Like the general level of interest rates,yield spreads between maturities change as the shape and slope of the yield curve adjusts with market expectations for monetary policy,growth,and inflation. Yield curve analysis enables Public Trust to identify opportunities across the term structure of interest rates for the City's investment program and construct portfolio allocations that benefit from future interest rate expectations that create the shape of the yield curve. This strategy also enables the City to diversify the investment program utilizing longer term securities Yield Duration Gtrvc in the Investment Account portfolio that balance the daily liquidity investments in the bond proceeds, capital project •Domestic and global •Utilize bullet.ladder, portfolios and bank balances. economic data barbell,or combination •Federal reserve strategy Sector Allocation: Within the context of an appropriately policy •Develop yield curve diversified portfolio, the allocation of assets to those sectors •Client guidelines outlook which afford greater relative-value opportunities can add •Risk management •Optimize security significantly to portfolio performance. Utilizing a mix of policies selection qualitative and quantitative analyses,our sector philosophies are primarily driven by relative value modeling,the experience of our credit team and their in-depth understanding of the technical and •Analyze spread •Issuers vetted fundamental state of the markets. relationships by team •In its quantitative sector analysis, Public Trust employs a Gauge risk premiums •Quantitativ aflalpls •statistical framework for making relative value decisions. Select undervalued Qualitative assessment sectors •.RevleW credit.Security ' Historical yield spreads between and among sectors with .Deselect overvalued strutture.and price different risk characteristics are tracked over long time periods sectors volatility with the average spread serving as a base case measure of fair Sector Sector value. As yield spreads approach the upper or lower end of their Rotation Selection • trading range as measured by standard deviation, we can determine that certain sectors or securities are trading"rich"or "cheap"to fair value based on probabilistic models and our forward-looking expectations. Contribution to duration analysis is utilized to measure the impact of obtaining various spread exposures along the yield curve.Non-Treasury securities with longer durations will contribute to greater portfolio spread duration than securities with shorter durations during periods of positive sloping yield curves. Once our quantitative analysis is complete, credit team members overlay their perspectives regarding the sector fundamentals. Security Selection:At Public Trust,we believe there are inefficiencies in the fixed income markets that an active manager can exploit to generate alpha - additional return. We utilize rigorous "bottom-up" fundamental analysis as a means for security selection resulting in one of the primary and durable sources of alpha generation in our portfolios. II 1Public Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 j _ t ! t1 � 3. Approach and Methodology We see the security selection process as a repeatable way to add value by exploiting mispricing at the individual security level. Public Trust's credit analysts and portfolio managers use their experience and knowledge of specific sectors in the context of broader investment themes developed by our Investment Committee. In corporate credit, our analysts use a combination of financial statement analysis, industry trends, discussions with company management, and quantitative models to establish the creditworthiness of issuers in their sectors. In a collaborative effort between analysts and portfolio managers, security selection opportunities are evaluated and identified to optimize risk-adjusted returns; and relative value analysis guides buy and sell decisions on individual securities. We utilize all four of these investment strategies when determining what we believe is the best option for each of the City's investment portfolios. We provide a summary of our recommendation so the City can make an informed decision for each transaction. The result is a diverse, highly customized investment program that is AAA rated by S&P,a Nationally Recognized Statistical Rating Organization (NRSRO). Strategies for the Value-Added Approach to Credit Research A fully independent credit research team is a critical component of any well-rounded investment program, especially for public funds investment programs managed with the primary objective of safety of principal, like the City's investment program. Public Trust continues to expand our credit research team with four professionals dedicated solely to the credit research function. Many of our Diversification by competitors either completely outsource this extremely important function or Indusuy&Issuer ''. have individuals that only perform credit research on a part-time basis. Characteristics of our Credit Research / Industry&Sector Public Trust Security • Rigorous&Dynamic _- Dynamics A roved -- Structure • Forward-Looking pp S.. • Systematic _ _-_...__ List • Proactive • Not dependent on external research j ! Risk Management:an essential component of any investment program that takes Issuer Business& on a heightened concern when corporate credit is part of the overall strategy. Our Financial Risk internal credit team constantly monitors and evaluates the health of our approved counterparties in respect to financial stability and relative value to government-backed obligations.As corporate yields narrow and widen,this impacts the return of the sector and the overall return of the portfolio.We strategically seek opportunities when we believe the market has underpriced a security with the goal of adding value through risk-adjusted returns. Independent Credit Research:this vital function must be performed on a full-time basis to be conducted appropriately given the dynamics of the markets.We place significant value in a completely independent credit research function.This full- time,independent credit research further reduces credit risk by eliminating yield and security selection bias and the potential of delayed actions to protect funds when performed on a part-time basis or solely from external credit research. Bond Proceeds Experience and Strategy Public Trust's deep knowledge and experience managing project funds,decommissioning funds and debt service reserve funds provides us with a unique perspective and advantage in building out the most appropriate strategies to maximize income and minimize any negative arbitrage. Above and beyond the considerations of general funds, operating cash, endowment funds and the like,bond proceeds (i.e.,funds derived from the sale of tax-exempt or taxable debt obligations) present several and often challenging considerations that can materially impact the borrower. Proceeds are likely subject to restrictions and covenants outlined under a Trust Indenture (or similar governing document)and are often held by a third-party trustee. In addition,there are complicated federal tax law considerations(i.e.,arbitrage rebate and yield restriction laws)that are unique to tax-exempt bond proceeds which require specialized experience and expertise to design and implement investment strategies. A well-considered bond proceeds investment strategy can materially reduce net financing costs while satisfying all safety, liquidity, legal and regulatory compliance requirements. The evaluation of alternative bond proceeds investment strategies begins with establishing the criteria by which those alternatives will be measured,and the relative weighting assigned to each of those criteria by the client. Those primary objectives of safety of principal, liquidity,and then yield,are followed by some additional objectives, depending on the circumstances and market conditions. Such additional objectives often include: • ensure,to the extent possible,that over the life of the bonds the investment return on all bond proceeds subject to the federal arbitrage rebate requirement is at least equal to the arbitrage yield on the bonds I2 ' Public Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 .1 r 3. Approach and Methodology ata • minimize(or eliminate whenever possible) market price risk upon the sale of one or more investment(s) prior to its maturity date • maximize flexibility for the issuer to terminate investments on the best terms possible • minimize the amount of ongoing time and effort investments will require from issuer staff • simplify arbitrage rebate and/or yield restriction compliance Once these general objectives have been tailored to specific client circumstances, Public Trust identifies the various investment vehicles and strategies available to attain those objectives. In general, the three primary classes of financial products that we consider as candidates for the investment of bond proceeds include (I) pooled investment funds (e.g., commercial money market funds and LGIPs), (2) structured products (e.g., investment agreements and forward delivery agreements),and (3) individual security portfolios(e.g.,treasury and agency bonds).Within each of these classes is a variety of instruments with differing risk profiles,mechanical characteristics,and ongoing administrative requirements which must be considered in the context of each client's specific circumstances. Public Trust's primary tool in the investment evaluation process is comparative cash flow modeling. For example, all fixed income investments can be represented by the cash flow they are expected to generate. For securities that(I) may mature prior to cash being needed or (2) bear a variable interest rate (e.g., pooled investment funds), Public Trust either makes assumptions about future interest rates or provides sensitivity analyses to address what we consider to be the range of best case(optimistic)to worst case(conservative) possibilities. Public Trust professionals have decades of experience managing bond proceed portfolios for our public-sector clients and have gained a deep understanding of this specialized and challenging process. Public Trust has a long history of coordinating with our bond proceed clients'financial advisors, bond counsel and rebate providers to clarify permitted investments,flow of funds, mark-to-market requirements and arbitrage regulations. We then apply our extensive experience to implement a sound strategy by fund type for the client's construction funds,capitalized interest and debt service reserve funds. While we approach the investment of bond proceeds similarly to our clients' other public funds assets, with the same objectives of safety and liquidity, we apply a unique investment strategy analysis to each issue based on the defining characteristics of the proceeds and the project. In addition,while some financial advisors try to maximize interest earnings today, we strive to maximize interest earnings over the life of the project funds while maintaining the key principle of safety. Because large complex construction projects change over time,so too will the underlying investment strategy. • Initial Portfolio • Reinvestment Strategy and Communication o Projected expenditures o Each maturity communicated with client o Permitted investments o Actual vs.projected expenditures o Current and anticipated draw schedules o Update of current market conditions o Relative value among sectors and maturities o Monitor arbitrage compliance rules o Coordinate settlement o Separate statements and reporting o Monitor expenditure adjustment • Sample Three ProjectScenarios 1 Samplemree ProjectScenartos $200 Maturivesys.Expendtture ,l s-12MonthAnalysis Projectland3Expenditures-12MonthAnalysis S60 $325 — OMonth End Balance f Cl Project 1 Expense ti $].50 ■InitlalDeposit S50 pProJect2FxpEnse Di Project 3 Expense $125 . aTotalMonthlyProjectOuttbws $40 ' .25100 i $30 $SO [ $20 II { Ft $25 ,1 l ^l 'l 1 1 ' $1D it 4 Oct Nov Dec Jan Feb. Mar Apr May Jun. Jul Aug Sep i Oct -Nov Dec Jan .Feb Mar Aor May Jun Jul Aug Seo Since many debt issues have multiple purposes for the bond proceeds (e.g., construction funds, debt service reserve funds, costs of issuance, refunding escrows, defeasance), there may be several investment portfolios for a single bond issue with various purposes. For example, the investment strategy for construction funds is based on the timing of anticipated expenditures,the shape of the yield curve, permitted investments,and arbitrage considerations. 13IPublic Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 i ] 3. Approach and Methodology We prefer to engage with our client's bond issuance team early on to help ensure all steps are taken in advance of the closing to minimize the amount of time the bond proceeds are in zero or low interest earning accounts and to help ensure multiple investment options are considered and evaluated and have the strategy in place once the proceeds have been wired into their respective accounts. A Partnership with a Leading Third-Party Arbitrage Rebate Provider We believe engaging a third party provides an independent approach to bond proceeds arbitrage calculations and reporting and that the firm calculating and verifying interest earnings should be a separate entity than the firm managing those assets. Public Trust uses an experienced third-party arbitrage provider, with which we coordinate, for the purposes of tracking, reporting,and analyzing arbitrage rebate calculations. Public Trust's preferred provider is BLX Group. Public Trust has a strategic partnership with the BLX Group who is an industry leader in providing arbitrage rebate and municipal advisory services to public sector clients. BLX's experience in successfully managing some of the toughest, most complex arbitrage compliance projects in the business has helped build a trusted reputation among the nation's largest and most demanding issuers since 1989. Comprehensive Online Reporting Platform Public Trust offers our clients a comprehensive reporting platform with advanced capabilities that provide required industry standard information.This reporting technology also allows for supplemental investment reports that are client specific.We have recently launched the newest version of our online reporting platform that includes automatic"push"statement delivery and we are developing the next version that will provide an online portal that will have the capability to warehouse historical statements, invoices,the investment policy statement and other cash and investment related documentation all of which will be stored securely in a password protected site. - Specific Reporting Capabilities and Characteristics include: IPUBLIC` 11U TRUST ADVIHQR9 Password Protected Online Access ' Daily market value for Public Trust managed assets Daily updated transaction activity Daily reconciliation to the custodian , Purchases,Sales, Maturities, MBS Paydowns, Interest Payments Client Login 7. Detailed securities holding report with CUSIP specific information Username. rr Trade date,YTM,coupon,par,original cost,maturity,ratings bte,V3lilvu Unrealized/Realized gain or loss Password GASB 40 statement disclosure Eider Your Password Ti Cash flow report detailing upcoming maturities and interest payments Login • Accounting reports to supplement internally generated reports N3 Quarterly and annual reports including market and economic information ra„ motor A. 14IPublic Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 11 3. Approach and Methodology pi l-UJJC' r4,' '9a.9 FRms a {'j 1171a1 TRUST pi511004AItS'4 4XU\r44I1 ra5i,+ SIATE11ENJS.. £i333Nllle �i�1 N7Jfll1. 0 w«,°i taw.is? I0*448*S4cL„N •I • Lr r'mr. educe ara Ys4Elt8um F.ninew.iaa L®y. Nartraectrar0 y, . • • • d6.us - .Mrerfm.Rtfu -i MD4mV.M1Y4tn'•«Y'- m.wr...mu.a 040 4D C••4 W le..Ra• .Nnu.eatiowlw . •. 041044 3 ..s.lbmn ®alalb 4d0r.m.lmn n.§y.C.0ad0. 1101:N a.+s. 4w im4404 4,ms. c4z% w.. irs !dells.alre'Nw4.va.r• 1!m nun la FOI1e6 _ tau .amk4?6,0.mal trl 46w40.6 OSWF ti• D331 4.r4Jam; 4uum,4 IMO" .a00......0.00s004....r40rc.M44-.wo.,..air♦0 410.4rw...4mr.. :lamiA. - 'jA'Atlt&ctl 18,0*fl4ue e.was®: cnFa . r06.03. .o.raacm [c4gltu0 1 nucnnSul " wrun>"'.o- ®O'er w,agcoo 2 4o as:4 nsu zro m, 31D. D4 4OQ,t1.M o111/ w-sa .n-rcD rm-lRr We develop investment reports based on our initial investment program review and consultation. All custom and standard reports can be categorized and shared with authorized users with controls to maintain specific formatting and reporting information. Why Public Trust? For more than 20 years the professionals at Public Trust have provided investment advisory services to municipalities and public entities in Florida that are governed by Florida State Statutes.Our local presence and familiarity with Florida Code and the seasonal cash flow profile of cities in Florida provides Public Trust with a unique advantage in our partnership with the City. We continue to increase our resources to better serve our clients' needs across all areas of the firm including investment advisory, portfolio management, credit research, information technology, operations, compliance, and client services. In addition,we provide a direct line of communication for senior level professionals in each area of the firm that allows for each client to contact the relationship manager and other Public Trust professionals that work directly with the City's investment program. Our strategy for each client relationship is to develop a strong understanding of the investment program. This includes defining the roles and responsibilities of the investment team, confirming an understanding of the client's risk tolerance and completing a thorough review of the investment policy statement, , internal controls and other procedures that provide a safe and effective approach with the primary objective of safety first. A few unique attributes that Public Trust offers through our partnership with the City of Miami Beach: The longest tenured public sector focused Florida based asset management team. Experienced investment advisory team led by John Grady, Managing Director(23 years),and Rod Bettini, Director(I2 years), m Portfolio management team that has been safely managing Florida Public Funds since 1998, with experience managing through multiple interest rate cycles,including the Great Financial Crisis and the COVID-I9 pandemic Seven member Orlando-based investment advisory team with industry leading experience and a focus on providing investment advisor resources in all aspects of Treasury management 7 Full suite of investment program resources including cash flow and portfolio structure analytics,industry leading reporting capabilities,accounting,and compliance support 15 ' Public Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 .{ 3. Approach and Methodology s Client communication focused approach that is paramount to the success of a public fund investment program,especially during uncertain economic times Cost Savings Opportunities We only serve public sector clients and we recognize the importance of the cost component for services provided to governmental entities. We also believe that every client should be provided with the highest level of service possible. Public Trust is structured to balance the cost of providing investment management and advisory services while striving to offer experienced professionals, innovative technology, security, insurance, and all other aspects required to offer an industry leading approach to public funds asset management. We promise to maintain our competitive fee structure and our offer to continue to pay for custody services and arbitrage rebate charges. We believe this provides a considerable cost savings to the City and provides an occasion to show our appreciation for the opportunity to serve the City of Miami Beach. I6IPublic Trust Advisors —City of Miami Beach DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Ifl Mn Appendix DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 IMll Appendix DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC WI TRUST Investment Management Services for the Public Sector Public Trust Advisors, LLC Firm Brochure Form ADV Part 2A This brochure provides information about the qualifications and business practices of Public Trust Advisors, LLC (Public Trust). If you have any questions about the contents of this brochure, please contact us at (855) 395-3954 or by email at barrv.howsden@publictrustadvisors.com. The information in this brochure has not been approved or verified by the United States Securities and Exchange Commission (SEC) or by any state securities authority. Additional information about Public Trust is also available on the Investment Adviser Public Disclosure website at www.adviserinfo.sec.gov. The CRD number for Public Trust Advisors is 159189. 717 17th St. Suite 1850 Denver, CO 80202 (855) 395-3954 www.oublictrustadvisors.com Registration with the SEC does not imply a certain level of skill or training. Version Date: April 30, 2021 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC® rpm TRUST ADVISORS Investment Management Services for the Public Sector Item 2: Material Changes This section describes the material changes to the Public Trust brochure since its annual updating amendment on May 15th, 2020. This brochure contains the following updates: ▪ All though not mentioned in the ADV,the President of Public Trust changed from Randy Palomba to Todd Alton, effective January 4th, 2021. ▪ Financial Information (Item 18, Part B) has been updated to remove the Firm's participation in the Payment Protection program through the Coronavirus Aid, Relief and Economic Security Act as this loan was forgiven on November 13th, 2020. N. Types of Advisors Services (Item 4, Part B), Investment Advisory Services, Administrative and Transfer Agency Services and Fund Accounting Services sections have been updated to include the Local Government Investment Pool (LGIP) of Wyoming Cooperative Liquid Assets Securities System (Wyoming CLASS) 7; Item 5: Fees and Compensation has been updated to include the additional calculation basis of current day's settled shares outstanding and prior day's net assets for Local Government Investment Pools. Form ADV 2A Version: 4/30/2021 2 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC® pjTRUST ADVISORS Investment Management Services for the Public Sector Item 3: Table of Contents Table of Contents Public Trust Advisors, LLC 1 Item 2: Material Changes 2 Item 3: Table of Contents 3 Item 4: Advisory Business 4 Item 5: Fees and Compensation 8 Item 6: Performance-Based Fees and Side-by-Side Management 12 Item 7: Types of Clients 12 Item 8: Methods of Analysis, Investment Strategies, and Risk of Investment Loss 12 Item 9: Disciplinary Information 15 Item 10: Other Financial Industry Activities and Affiliations 16 Item 11: Code of Ethics, Participation or Interest in Client Transactions, and Personal Trading 17 Item 12: Brokerage Practices 18 Item 13: Reviews of Accounts 20 Item 14: Client Referrals and Other Compensation 21 Item 15: Custody 22 Item 16: Investment Discretion 22 Item 17: Voting Client Securities (Proxy Voting) 23 Item 18: Financial Information 23 Form ADV 2A Version: 4/30/2021 3 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC° 11111 TRUST ADVISORS Investment Management Services for the Public Sector Item 4: Advisory Business A. Description of the Advisory Firm Public Trust Advisors, LLC(Public Trust) is a limited liability company organized in the state of Colorado. This firm was founded on September 22, 2011 and currently has offices in eight (8) states including Arizona, California, Colorado, Florida, New Mexico, New York, Ohio, and Texas. The principal owners are Thomas D. Jordan, Randy S. Palomba,Thomas N.Tight II,John F. Grady III, Christopher.M. DeBow and Bear Creek Products 2019-2 (PTA-E), LLLP. In September of 2019, Public Trust announced its partnership with Bear Creek Products 2019- 2 (PTA-E), LLLP (Bear Creek). Public Trust partnered with Bear Creek to provide minority capital investments for succession planning,future potential acquisitions,and for other capital- intensive strategic initiatives. As of April 28, 2020, Bear Creek maintains a 42% ownership interest in the firm while the five (5) Public Trust legacy owners possess the remaining 58%. The firm's operating agreement contains succession planning provisions designed to ensure that legacy owners maintain a controlling interest in the firm. However, if through the permanent disability or death of any legacy owner, Bear Creek's interest were to potentially exceed 49.99%, the remaining legacy owners would have the right of first refusal for share repurchase. In the future, should any remaining legacy partner be unable or unwilling to purchase the departing legacy owner's interests,then any additional shares acquired by Bear Creek from 49.99% to 59.99% would carry no additional voting rights. Public Trust will, from time-to-time, utilize the services of a third party in a sub-advisory capacity to provide certain services to its clients including but not limited to arbitrage rebate compliance services. In these cases, Public Trust obtains written permission from the client and ensures the client receives all required disclosure information regarding the sub-advisor. Public Trust continually monitors the services provided by the sub-advisor. B. Types of Advisory Services Public Trust offers the following services to its clients: Investment Advisory Services Public Trust offers investment advisory services to state and local U.S. government entities, non-profit corporations, charitable organizations, and other institutional clients. Clients are obtained by direct marketing or referred by unaffiliated,third-party solicitors. Service product offerings include: Form ADV 2A Version: 4/30/2021 4 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC - 11111 ADVISORSO R S Investment Management Services for the Public Sector 5 Separately Managed Accounts (SMA) - Separate account portfolio management services are provided on either a discretionary or non-discretionary basis depending upon each client's needs and requirements and are subject to the written investment guidelines provided by each client. The investment guideline information provided by each client, together with any other information relating to the client's overall investment requirements (investment policy statement), will be used by Public Trust to determine the appropriate investment strategy for each client portfolio. Portfolio managers typically manage multiple accounts consisting of the same or similar investment strategies. Local Government Investment Pools (LGIP) — Local government investment pools are offered to state and local municipalities,counties,school districts,utility districts,and other local government units (Participants). LGIPs combine the cash of participating jurisdictions and invest in securities allowed under state law, subject to each LGIP's written investment guidelines on a discretionary basis. These guidelines, together with any other information relating to the LGIPs overall investment requirements (investment policy statement),, are used by Public Trust to determine the appropriate investment strategy. Public Trust serves as either the marketer, investment advisor, administrator, or a combination thereof, for the following LGIPs: Colorado Local Government Liquid Asset Trust(COLOTRUST), Michigan Cooperative Liquid Assets Securities System (Michigan CLASS), New York Cooperative Liquid Assets Securities System (NYCLASS), Texas Cooperative Liquid Assets Securities System Trust (Texas CLASS), Florida Cooperative Liquid Assets Securities System (FLCLASS), Virginia Investment Pool (VIP), Wyoming Cooperative Liquid Assets Securities System (Wyoming CLASS), and TrustlNdiana. Each LGIP is overseen by an authorized Governing Board or a State Treasurer.The Governing Board is typically comprised of public officials from Participants within each LGIP. LGIP TERM Series Fund (Term Series) — A specially designed feature allowable by certain LGIPs that complements the daily liquidity of the LGIP by offering longer dated, fixed- income investments with maturities between 90 and 365 days, as permitted under state statute and the LGIP's governing documents. Each Term Series consists of deposits in financial institutions and/or other allowable investments as defined within the investment policies governing the respective LGIP. Each Term Series is a separate and distinct investment option within the respective LGIP that Participants may choose to establish. Term Series are intended to be held until maturity. A withdrawal prior to maturity may result in penalties including but not limited to loss of all interest and other fees caused by early redemption. Currently this product is only being offered for the TrustlNdiana LGIP. Public Trust does not assume any responsibility for the accuracy of the information provided by a client and is not obligated to verify any information received from a client. Under all circumstances, clients should promptly notify Public Trust in writing of any changes to their Investment Policy Statement. In the event a client notifies Public Trust of changes to its Investment Policy Statement, Public Trust reviews the changes, performs a compliance verification to identify any non-compliant securities, and implements any necessary revisions or remedial actions to the client's portfolio. Form ADV 2A Version: 4/30/2021 5 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC HilleiDITISORS TRUST Investment Management Services for the Public Sector Public Trust invests client assets in fixed income securities. Please refer to Item 8 for additional information about methods of analysis and investment strategies used by Public Trust and their associated risks. Administrative and Transfer Agency Services Public Trust offers administrative and transfer agency services to the LGIPs of COLOTRUST, Michigan CLASS, NYCLASS, Texas CLASS, TrustlNdiana, Louisiana Asset Management Pool (LAMP), FLCLASS, Wyoming CLASS, and VIP. Services offered include but are not limited to the maintenance of Participant records, transactions and account balances, and money movements based on client requests. Fund Accounting Services Public Trust offers fund accounting services for COLOTRUST,Michigan CLASS, NYCLASS,Texas CLASS, TrustlNdiana, LAMP, FLCLASS, Wyoming CLASS, and VIP. Services offered include the daily accounting of assets, income earned, and expenses incurred to derive a daily net asset value (NAV) and a daily or periodic dividend rate to be paid to Participants. Additional services provided are annual financials and Board reports. Consulting Services Public Trust provides certain investment-related consulting services to clients. Consulting services include but are not limited to the following: w Request for proposals (RFP) creation and implementation; ▪ Review of investment portfolio(s) and investment policies; Review of organization structure and functions regarding the investment activities; • Review of investment compliance with applicable state and internally imposed requirements.; .. Future investment planning strategies, implementation analysis, and recommendations; ▪ Broker-dealer selection assistance; ▪ Banking institution selection assistance; 7,1 Investment risk analysis. Form ADV 2A Version: 4/30/2021 6 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC I'i'I ADVISORS TRUST Investment Management Services for the Public Sector Non-Managed Account Services Some Public Trust clients request that we establish one or more non-managed account(s) for the purposes of client reporting. These accounts do not receive ongoing supervision and monitoring services like those provided to accounts through our investment advisory services described above. Public Trust does not make any investment recommendations and will not monitor specific securities or general portfolios for these accounts. The primary purpose for this service is to include non-managed accounts owned by the client in the performance reports provided by Public Trust. Public Trust does not currently charge a fee for this service. However, clients are typically required to enter into a written agreement with Public Trust, and they are provided a copy of this disclosure brochure prior to establishing a non-managed account. C. Client Tailored Services and Client Imposed Restrictions Public Trust offers the same suite of services to all its SMA clients. However, specific client financial plans and their implementation are dependent upon the client Investment Policy Statement that outlines each client's current investment objectives (income, cash flow considerations, tax levels, and risk tolerance levels) and is used to construct a client-specific plan to aid in the advice or selection of a portfolio that matches restrictions,needs,and targets. At the beginning of the client relationship, Public Trust contacts the client to gather and discuss information regarding their overall investment objectives, risk tolerances, and guidelines. Where applicable, an Investment Policy Statement is requested from the client and utilized to tailor the investments and objectives of the portfolio. From there,Public Trust assists the client in determining the investment strategy or strategies that are best suited to meet the client's needs and objectives. Once a client has selected an investment strategy or strategies, Public Trust provides continuous supervision and management of the assets. Clients are responsible for informing Public Trust of any changes to their investment objectives and /or restrictions. D. Wrap Fee Programs A wrap fee program is an investment program where the investor pays one stated fee that includes management fees, transaction costs, fund expenses, and any other administrative fees. Public Trust does not participate in any wrap fee programs. E. Amounts Under Management As of December 31, 2020, Public Trust had discretionary assets under management in the amount of$43,085,164,469 and non-discretionary assets under management in the amount of $5,841,286,922. In addition, Public Trust offers fund accounting, administrative, and transfer agency services to one LGIP with respect to assets in the amount of$2,656,441,795. Separately Managed Accounts $9,723,668,961 Form ADV 2A Version: 4/30/2021 7 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC 11111 TRUST ADVISORS Investment Management Services for the Public Sector Local Government Investment Pools $39,202,782,430 Item 5: Fees and Compensation A. Fee Schedule Local government investment pool(LGIP) fees LGIP account fees are calculated using one of the following methods: ▪ Current day's shares outstanding: The current day's shares outstanding will be multiplied by the applicable fee rate(s) and divided by 365 days (366 days in the event of a leap year)to equal the daily fee accrual. For weekend days and holidays,the shares outstanding for the previous business day will be utilized for the calculation of the fees. Monthly invoice calculations will include holidays and weekends that fall within the month. Current day's settled shares outstanding: The current day's settled shares outstanding will be multiplied by the applicable fee rate(s) and divided by 365 days (366 days in the event • of a leap year) to equal the daily fee accrual. For weekend days and holidays, the settled shares outstanding for the previous business day will be utilized for the calculation of the fees. Monthly invoice calculations will include holidays and weekends that fall within the month. ,. Prior day's net assets: The prior day's net assets will be multiplied by the applicable fee rate(s) and divided by 365 days (366 days in the event of a leap year) to equal the daily fee accrual. For weekend days and holidays, the net assets for the previous business day will be utilized for the calculation of the fees. Monthly invoice calculations will include holidays and weekends that fall within the month. TT Ending market value: The ending market value of the,daily holdings of the current business day will be multiplied by the applicable fee rate(s) and divided by 365 days (366 days in the event of a leap year) to equal the daily fee accrual. For weekend days and holidays, the market value for the previous business day will be utilized for the calculation of the fees. Monthly invoice calculations will include holidays and weekends that fall within the month. 71 Ending market value: The ending market value of the daily holdings on the fifteenth and last calendar days will be multiplied by the applicable fee rate(s) and divided by 365 days (366 days in the event of a leap year) and multiplied by the number of days in the semi- monthly period to equal the monthly accrual. If the fifteenth or the last calendar day fall on a holiday or weekend, then the prior business day will be utilized as the basis for the fee calculation. If the first day of the month is a holiday or weekend day,the ending market value from the preceding business day will be utilized to calculate the daily accrual Form ADV 2A Version: 4/30/2021 8 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC° III11 TRUST ADVISORS Investment Management Services for the Public Sector amount(s). Monthly invoice calculations will include holidays and weekends that fall within the month. Fees will be tiered or at a fixed rate depending on the agreement for the specific LGIP. Fees can be charged up to an annual rate of 15 basis points (0.15%). Fees paid to Public Trust for the LGIPs cover portfolio management, fund accounting, administrative and transfer agency services as well as certain auxiliary expenses including but not limited to legal, audit, and board expenditures (where applicable). All fees are payable monthly in arrears by the client to Public Trust, the administrator, or the lead participant. All invoices are approved by at least one Board Member or the administrator prior to payment being rendered. Certain agreements between Public Trust and an LGIP's Boards of Trustees can allow for fees to be waived. Fees can be voluntarily waived or abated at any time, or from time-to-time, at the sole discretion of Public Trust. Periodic fee waivers may be required to adjust the fund's yield performance based on various market conditions. In some cases, waived fees may be restored by written agreement between Public Trust and the Board of Trustees or the Administrator. Fees will be paid and initiated by Public Trust via Automated Clearing House (ACH), wire, or paid directly by the Board via check or wire. Term Series fees Term Series fees are calculated as follows: Annual fees can be up to a 15 basis points fee (0.15%) from the Investment Property Value (the Daily Fee). The daily fee will accrue on a daily basis for the duration of the investment in the Term Series and be paid at maturity. The daily fee shall be calculated as follows: the Investment Property Value is multiplied by a percentage up to 15 basis points (0.15%) and is divided by 365, or 366 days in the event of a leap year, to equal the daily fee accrual. The Investment Property is the underlying amount invested in the Term Series.The fee will be deducted from the proceeds at the maturity or termination of the investment. Separately Managed Account(SMA)fees SMA account fees are calculated using one of the following methods: Average daily market value of the underlying assets under management (including or excluding certain cash and cash equivalents) and based on the number of days in the month and year for the specified billing cycle of monthly or quarterly; 11 Average daily market value plus accrued interest of the assets under management in the account (including or excluding certain cash and cash equivalents) and based on the Form ADV 2A Version: 4/30/2021 9 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC° II"I ADVISORS TRUST Investment Management Services for the Public Sector number of days in the month and year for the specified billing cycle of monthly or quarterly; Weighted average of the average monthly daily book values of the underlying net assets under management in the account(including certain cash and cash equivalents) and based on the number of days in the month, quarter, and year for the specified billing cycle of quarterly; 74 Weighted average of the average monthly market values (including or excluding certain cash and cash equivalents) based on the number of days in the month, quarter, and year; 72 Ending market value for the month or quarter; Ending market value plus accrued interest(including or excluding certain cash equivalents) for the month; 7. Fixed monthly installments based on an annual fee. Fees will be calculated based on the number of days in the preceding month or quarter of the billing period. Fees will be based on the number of the days in the year (leap year, 366 days) or at a fixed basis of 365 days. Fees can be prorated if the billing period is not a full monthly or quarterly period. Fees will be charged at a fixed-rate, tiered rate structure or a fixed dollar amount per billing period based on the terms of the Investment Advisory Agreement or other written communication by or with the client. Certain agreements cap fees at a maximum amount per quarter or year. Public Trust can also impose a minimum fee of up to $1,000 per month in accordance with the Agreement or other written communication by or with the client. Certain related client accounts can be grouped together for the purposes of determining the annual fee. Certain agreements or written communication by or with the client allow for management fees to be waived if the average balance(s) in a LGIP managed by Public Trust is maintained for the specified billing period. Certain agreements stipulate that Public Trust pay auxiliary fees such as custody fees and arbitrage fees. Certain states impose taxes for doing business in that state. These taxes, where agreed upon by the client, will be collected in addition to the fees associated with services provided by Public Trust. Overall, fees are based upon the needs of the client and complexity of the situation, agreed to in writing with the client, and evidenced in the final fee schedule of the executed Agreement or other written communication by or with the client. Fees are invoiced to the client and are paid either monthly or quarterly in arrears. Clients have the option to terminate their Agreement per the terms of their Agreement with Public Trust. Since fees are charged in Form ADV 2A Version: 4/30/2021 10 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC® I1111i TRUST Investment Management Services for the Public Sector arrears, no refund policy is necessary. If the Agreement is terminated by either the client or Public Trust prior to the end of a billing period, fees shall be prorated to the effective date of termination. Annual fees can be up to 30 basis points (0.3000) although Public Trust retains the discretion to negotiate alternative fee arrangements on a case-by-case basis depending on the nature of services to be provided,the type of client, the complexity of the client's needs, the amount of assets to be managed, other assets the client may have invested with us, the anticipated future invested assets, and other relevant factors. Fees will be collected via check, ACH, bank wire, or directly from the client's custodian account(s). All fees charged to clients are fully described in the Investment Advisory Agreement between the client and Public Trust or other written communication by or with the client. Public Trust directly invoices clients for investment advisory services. To the extent the designated custodian consents, some clients provide written authorization for Public Trust to submit their fee invoice to the designated custodian for payment of fees directly from client's account (monthly in arrears). In such instances, Public Trust provides the client with a copy of the fee invoice for the specified billing period. In the event the designated custodian does not consent, Public Trust shall submit monthly invoices to the client who shall remit payment within 30 days. Public Trust recommends these clients carefully review their custodian statement on at least a quarterly basis and alert us of any discrepancy. Consulting Services Fees Payment received by Public Trust for providing consulting services to clients is based on the scope of services to be performed, the time frame, and the complexity of the work to be completed. Clients are charged based on fixed monthly installments based on an annual fee. The fee is negotiable and depends on the extent of services required and is mutually agreed to in writing by the client and Public Trust. B. Other Fees and Expenses Clients should understand that the advisory fees described herein may not include certain charges imposed by third parties such as custodial fees and expenses. Client assets can also be subject to (as applicable) transaction costs, retirement plan administration fees, odd-lot differentials, transfer taxes, wire transfer and electronic fund fees, and other fees and taxes on brokerage accounts and securities transactions. Brokerage and other transaction costs are generally embedded in the offering price of the underlying security at trade execution. Please see Item 12 for further information on the brokerage practices of Public Trust. These fees and expenses can be separate from and in addition to the fees charged by Public Trust. Accordingly, each client should review all applicable fees to fully understand the total Form ADV 2A Version: 4/30/2021 11 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC u TRUST ADVISORS Investment Management Services for the Public Sector amount of fees to be paid by the client and to thereby evaluate the advisory services being provided. C. Prepayment of Fees Not applicable. D. Outside Compensation for the Sale of Securities to Clients Neither Public Trust nor its supervised persons accept any compensation for the sale of securities or other investment products including asset-based sales charges or services fees from the sale of mutual funds. Item 6: Performance-Based Fees and Side-by-Side Management Public Trust does not charge or accept performance-based fees or other fees based on a share of capital gains on or capital appreciation of the assets of a client. Item 7: Types of Clients Public Trust offers investment advisory services to state and local U.S. government entities, non-profit corporations, and charitable organizations. Public Trust investment advisory clients include state and municipal governmental entities and non-profit corporations including hospitals, schools, colleges, and cultural institutions that have raised funds through the issuance of tax-exempt debt obligations. Minimum Account Size Currently, there is no minimum account requirement for SMA clients and LGIP Participants. For the Term Series, the minimum investment amount is $500,000.00. There is no minimum investment per Participant as long as the aggregate amount pledged for each Term Series totals a minimum of$500,000.00.The firm may,at its sole discretion,waive this minimum investment amount. Public Trust evaluates accounts on a case-by-case basis. Item 8: Methods of Analysis, Investment Strategies, and Risk of Investment Loss Form ADV 2A Version: 4/30/2021 12 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2CO PUBLIC 11111 ADVISORS o R s Investment Management Services for the Public Sector A. Methods of Analysis and Investment Strategies Methods of Analysis The Public Trust methods of analysis include fundamental and technical analysis. vi Fundamental analysis - Involves the evaluation of a security by attempting to measure its intrinsic value by studying related economic, financial, and other qualitative and quantitative factors. ▪ Technical analysis - Involves the examination of past market data such as prices and the volume of trading that may provide an estimate of the future value of a security. Investment Strategies Public Trust has four (4) investment strategies, each with different investment objectives as outlined below. ▪ Money Market: This strategy is offered only to LGIPs emphasizing convenient, short-term investment opportunities carefully chosen to optimize interest earnings while at the same time maximizing safety and liquidity. Short-term, high-quality fixed-income securities are utilized due to their minimal credit and volatility risk with the objective•of maintaining a constant $1.00 net asset value. Typically, this strategy can invest in U.S. Treasury and agency securities, commercial paper, repurchase agreements, bank deposits, certificates of deposit, and corporate notes with a weighted average maturity (WAM) to reset of 60 days and WAM to final of 90-120 days. • Enhanced Cash: The overall objective is to preserve capital while providing high current income with a high degree of liquidity and lower excess risk than short-term benchmarks. Short-term, high-quality fixed-income securities are utilized due to their minimal credit and volatility risk. Generally, the WAM of the investments in this strategy can range from six to eighteen months. Typically, this strategy invests in U.S. Treasury and agency securities,commercial paper,short-term corporate notes and bonds,and municipal bonds. 7,7 Core Assets: The overall objective is to provide a steady stream of income with longer- term capital appreciation. High-quality, fixed-income investments are utilized to ensure minimal credit and volatility risk. This strategy involves active management of duration, sector, and security selection. Common benchmarks for this strategy are often the ICE BofAML 1-3 Year U.S. Treasury, the ICE BofAML 1-5 Year U.S. Treasury, the ICE BofAML 1-3 Year U.S. Treasury & Agency, and the ICE BofAML 1-5 Year U.S. Treasury & Agency indexes (or other benchmarks as specified in the client's investment policy). Typically,this strategy invests in U.S.Treasury and agency securities as well as medium-term corporate and municipal bonds. Form ADV 2A Version: 4/30/2021 13 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC® fii• TRUST • A D v r s o R s Investment Management Services for the Public Sector Bond Proceeds: For portfolios where there are liability-driven investment considerations such as clients whose portfolios are funded with bond proceeds that are utilized to make payments associated with certain projects, we recommend securities specifically matched to meet appropriate draw schedules. We modify the portfolio as the schedule changes or as investment opportunities present themselves. B. Material Risks Involved Investing involves risks including the possible loss of principal that clients would have to bear.The investment decisions made by Public Trust for clients are subject to certain risks and such decisions may not always be profitable. Public Trust does not guarantee returns or performance against stated benchmarks. Past performance is not a guarantee of future results. Many factors affect performance including changes in market conditions and interest rates and in response to other economic, political, or financial developments. The following is a summary of common risks associated with investing in fixed-income securities. • Interest Rate Risk: A bond's price and yield share an inverse relationship. Interest rate risk involves a change in a bond's value due to a change in the absolute level in interest rates, the spread between two rates, or a shift in the yield curve. The actual degree of a bond's sensitivity to changes in interest rates depends on various characteristics of the investment such as coupon and maturity. ▪ Credit Risk: The risk that a bond issuer fails to make payments for which it is obligated. Public Trust focuses on an issuer's financial condition to gauge its ability to make payments of interest and principal in a timely manner. Credit risk is also gauged by quality ratings organizations such as Moody's and S&P Global Ratings. • Liquidity Risk: The degree to which an investment can be sold at or near its fair value.The size of a bond's market, the frequency of trades, the ease of valuation, and/or issue size can possibly impact liquidity risk. . Market Risk: The risk that the value of securities owned goes up or down, sometimes rapidly and/or unpredictably, due to factors affecting securities markets generally or within particular industries. • Migration Risk: The risk that an underlying issuer's credit rating can change over time due to fundamental or idiosyncratic factors that impact the value of an investment. • Issuer Risk: The risk that the value of a security declines for a reason directly related to the issuer such as management performance, financial leverage, and reduced demand for the issuer's goods or services. Form ADV 2A Version: 4/30/2021 14 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C3181A2C0 PUBLIC IIENITRUST A D v r s o B s Investment Management Services for the Public Sector • Default Risk: The risk that a bond issuer (or counterparty) will default by failing to repay principal and interest in a timely manner. • Early Withdrawal Risk: The risk that an investor withdraws their deposit amount from an account before the agreed-upon maturity date. Term Series investments are intended to be held to maturity.A withdrawal prior to maturity will require advanced notice as required. The market value of bonds will fluctuate with interest rates and other market conditions prior to maturity and will equal par value at maturity. Interest rates for bonds can be fixed at the time of issuance and payment of principal; interest can be guaranteed by the issuer and, in the case of U.S. Treasury obligations, backed by the full faith and credit of the U.S. Treasury. Since U.S. Treasury bonds have longer maturities, the market value of U.S. Treasury bonds will generally fluctuate more than U.S. Treasury bills. Public Trust generally seeks investments that do not involve significant or unusual risk beyond the scope of the domestic, high-grade fixed-income universe. Public Trust believes that the common risks associated with investing in fixed-income securities as outlined above can be mitigated by prudently diversifying a portfolio's holdings. Public Trust also manages these portfolio holdings in concert with the client's individual investment policy and risk tolerances. C. Risks of Specific Securities Utilized Public Trust generally seeks investment strategies that do not involve significant or unusual risk beyond that of the general domestic and/or international bond markets. v. Treasury Inflation Protected/Inflation Linked Bonds: The risk of default on these bonds is dependent upon the U.S. Treasury defaulting (extremely unlikely); however, they carry a potential risk of losing share price value albeit rather minimal. 71 Fixed income is an investment that guarantees fixed, periodic payments in the future that involve economic risks such as inflationary risk, interest rate risk, default risk, and repayment of principal risk, etc. • Debt securities carry risks such as the possibility of default on the principal, fluctuation in interest rates, and counterparties being unable to meet obligations. ▪ Short term trading risks include liquidity, economic stability, and inflation. Item 9: Disciplinary Information Form ADV 2A Version: 4/30/2021 15 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC I I ADVISORS TRUST Investment Management Services for the Public Sector A. Criminal or Civil Actions Neither Public Trust nor any of its employees have been subject to regulatory disciplinary action. B. Administrative Proceedings There are no administrative proceedings to report. C. Self-Regulatory Organization (SRO) Proceedings There are no self-regulatory organization proceedings to report. Item 10: Other Financial Industry Activities and Affiliations A. Registration as a Broker-Dealer or Broker-Dealer Representative Neither Public Trust nor any of its representatives are registered or have an application pending to register as a broker-dealer or a registered representative of a broker-dealer. Public Trust does not recommend or select other investment advisors for clients in exchange for compensation from those advisors. Registration as a Futures Commission Merchant, Commodity Pool Operator, or a Commodity Trading Advisor Neither Public Trust nor its representatives are registered as or have pending applications to become a futures commission merchant, commodity pool operator, or commodity trading advisor. B. Registration Relationships Material to this Advisory Business and Possible Conflicts of Interests Neither Public Trust nor its representatives have any material relationships to this advisory business that would present a possible conflict of interest. C. Selection of Other Advisors or Managers and How This Advisor is Compensated for Those Selections All client assets are managed solely by Public Trust.The firm does not select or utilize third party managers or other advisors. Form ADV 2A Version: 4/30/2021 16 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLICS II I ADVISORS TRUST Investment Management Services for the Public Sector Item 11: Code of Ethics, Participation or Interest in Client Transactions, and Personal Trading A. Code of Ethics Public Trust maintains a policy of strict compliance with the highest standards of ethical business conduct and the provisions of applicable Federal securities laws including rules and regulations promulgated by the U.S.Securities and Exchange Commission. Public Trust has adopted a written Code of Ethics in accordance with Rule 204A-1 of the Advisers Act of 1940 that sets forth specific provisions relating to personal and proprietary securities transactions, outside business activities, and confidentiality.The Code of Ethics covers the following areas: statement of general policy, access persons, chief compliance officer (CCO) designee, standards of business conduct, protecting the confidentiality of client information, social media, prohibition against insider trading, preclearance, personal securities transactions, reporting procedures, participation in affiliated limited offerings, gifts and entertainment, political contributions, rumor mongering, whistleblower policy, reporting of violations and sanctions, records, and acknowledgement. Upon request, our Code of Ethics is available to any current or prospective client. B. Recommendations Involving Material Financial Interests Public Trust does not recommend that clients buy or sell any security in which a related person to Public Trust or for which Public Trust has a material financial interest. C. Investing Personal Money in the Same Securities as Clients Public Trust does not recommend that clients buy or sell any security in which a related person to Public Trust or for which Public Trust has a material financial interest. D. Trading Securities At/Around the Same Time as Clients' Securities Infrequently, Public Trust representatives have the option to buy or sell a security for their own accounts that coincidentally is being purchased or sold for the accounts of its clients. The fixed-income securities that Public Trust recommends for purchase and sale are of the type that the Securities and Exchange Commission has expressly recognized as presenting little opportunity for the type of improper trading that compliance with the Code of Ethics reporting requirements is designed to uncover. Whenever Public Trust representatives act in a fiduciary capacity,they will always put the clients'interests ahead of their own. Form ADV 2A Version: 4/30/2021 17 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC° pi ADVISORS TRUST Investment Management Services for the Public Sector Item 12: Brokerage Practices A. Selection Criteria and Best Execution As a fiduciary,Public Trust has an obligation to use its best efforts to seek to obtain the best available price and most favorable execution given the circumstances with respect to all portfolio transactions placed by Public Trust on behalf of our clients.This process is commonly referred to as"best execution."As part of our best execution process,Public Trust evaluates broker-dealers on a variety of criteria including but not limited to: (i) capital strength and stability, (ii) execution capabilities, (iii) trading expertise in fixed-income securities, (iv) inventory of fixed-income securities, (v) liquidity, (vi) any transaction costs, and (vii) reliable and accurate communications and settlement capabilities. From the evaluation, Public Trust selects and maintains a list of brokers (approved brokers) through which transactions will be affected for customer accounts.To help ensure the firm is meeting its best execution obligations Public Trust performs a periodic(no less than annually) review of its trading practices and executions. B. Order Aggregation and Allocation From time-to-time, Public Trust will determine that the purchase or sale of a security is appropriate for multiple client accounts based on a variety of reasons. When this happens, Public Trust will determine whether it is appropriate,in the interest of efficient and effective execution,to attempt to execute the trade orders as one or more block trades(i.e.aggregate the securities to be traded for each such account into one or more trade orders).These circumstances can in turn give rise to actual or potential conflicts of interest among the accounts for whom the security purchase or sale is appropriate and among the subset of those accounts participating in a block trade, especially if the block trade order results in a partial fill. To address these conflicts, Public Trust has adopted policies and procedures regarding allocating investment opportunities and executing block trades to provide an objective and equitable method of allocation so that all clients are treated fairly.The basic objectives of these policies and procedures are as follows: • Public Trust always allocates investment opportunities among clients'accounts in a fair and equitable manner based on each client's overall investment objectives and strategy and any restrictions placed on the management of the account; . Public Trust only aggregates clients' trades when it believes that such aggregations are consistent with its duty to seek best execution for its clients; Form ADV 2A Version: 4/30/2021 18 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC° 11111 TRUST ADVISORS Investment Management Services for the Public Sector 71 Public Trust strives to ensure that no single client participating in a block trade is favored over any other participating client; To avoid odd lots containing small allocations, certain adjustments will be made under certain circumstances; v. Non-discretionary accounts may or may not participate in block trades due to liquidity, availability, and cash flow needs. C. Soft Dollar Considerations Public Trust prohibits the use of third-party,soft dollar arrangements and has never entered into a soft dollar arrangement.Therefore, our customers are never charged for any soft dollar research. However, during the course of doing business, we will receive research including unsolicited research from broker-dealers. This information is often the same material that is made available to all their clients and is publicly available through the Internet.This information is further outlined in Section 28(e)of the Securities and Exchange Act of 1934 and,although customary and permitted,could possibly be deemed as an implied economic benefit. D. Directed Brokerage In certain circumstances, Public Trust can accept written direction from a client regarding the use of a particular broker-dealer to execute some or all transactions for that client.When this happens,the client has usually negotiated terms and arrangements for the account with the broker-dealer, and Public Trust will not seek better execution services or prices from other broker-dealers. Depending on the arrangement, Public Trust will not be able to aggregate a client's directed brokerage transaction with other Public Trust client transactions. Importantly, Public Trust will have limited ability to ensure any broker-dealer selected by the client will provide the best possible execution.Thus,the client can pay higher commissions, other transaction costs, greater spreads, or receive less favorable net prices on transactions for the account than would otherwise be the case.Subject to its duty of best execution Public Trust can decline a client's request to directed brokerage if, at the sole discretion of Public Trust,such directed brokerage arrangements would result in additional operational difficulties and/or would not be in the best interest of the requesting client. E. Trade Errors Public Trust has internal controls for the prevention of trade errors. However,trade errors in client accounts cannot always be avoided. Public Trust strives to correct all trade errors prior to the settlement of any transaction. Public Trust maintains records of all errors that occur including the original trade ticket,trade date, broker, client affected, identification of the source of the error, the results of the error, and any correction including future Form ADV 2A Version: 4/30/2021 19 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC° TRUST ADVISORS Investment Management Services for the Public Sector preventative measures. Consistent with its fiduciary duty, it is the policy of Public Trust to correct trade errors in a manner that is in the best interest of the client. Public Trust will promptly notify the client if a trade error results in a gain or loss to the client. In cases where the client causes the trade error,the client will be responsible for any loss resulting from the correction. Depending on the specific circumstances of the trade error,the client may not be able to receive any gains generated because of the error correction. If the error was caused by Public Trust,the client will be notified, and the trade error will be reviewed and mitigated by Public Trust. If the error is caused by the broker-dealer,the broker-dealer will be responsible for working directly with the client and/or Public Trust to assess and mitigate any associated costs. If an investment gain results from the correcting trade, the gain will remain in the client's account. Public Trust will also confer with the client to determine if the client should forego the gain (e.g.due to tax reasons). Public Trust never retains any portion of any gains made resulting from trade error corrections or profits in any way from trade errors. If the gain does not remain in the account,Public Trust will donate the amount to charity. If related trade errors result in both gains and losses in an account,generally they will be netted. Item 13: Reviews of Accounts A. Frequency and Nature of Periodic Reviews and Who Makes Those Reviews A member of portfolio management will review clients' accounts with regard to their investment policies, risk tolerance levels,and allocations on a periodic basis. B. Factors that will Trigger a Non-Periodic Review of Client Accounts Reviews can be triggered by material market,economic or political events,or by changes in the client's financial situation. C. Content and Frequency of Regular Reports Provided to Clients Monthly or quarterly reports and/or online access to client transaction activity is provided to all SMA clients. The report information discloses such items as portfolio returns/yields, holdings, transactions, and issuer concentrations. In addition, Public Trust performs an annual review with each SMA client to verify they are receiving, at a minimum, quarterly statements directly from their qualified custodian.Custody statements detail the assets and values held in the clients' accounts. Clients are urged to carefully review all custodial statements and compare them to any account reports provided by Public Trust. Form ADV 2A Version: 4/30/2021 20 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31 B1 A2C0 PUBLIC gm ADVISORS TRUST Investment Menageme.nt Services for the Public Sector Monthly statements are made available to all LGIP Participants denoting their balances, transactions, and income earned for the period. In addition, Public Trust ensures that each LGIP Board, or a designated recipient for the LGIP, receives, at a minimum, quarterly statements from their qualified custodian. For the Term Series, all transactional activity for LGIP Participants investing in a Term Series is incorporated into the respective Participants'LGIP monthly statements mentioned above. In addition,Public Trust ensures that each LGIP Board,or a designated recipient for the Term Series, receives,at a minimum,quarterly statements from their qualified custodian. Currently, one LGIP is provided a quarterly, unaudited financial statement that is delivered to the underlying Participants via the LGIP's website shortly after each quarter-end.All LGIPs and Term Series have an annual financial audit performed by an independent auditing firm. The Term Series will be audited in conjunction with the LGIP and inclusive of the annual audited financial statements. The auditors are registered with and subject to regular inspection by the Public Company Accounting Oversight Board (PCAOB). Participants are notified via email within 120 days of the LGIP's fiscal year-end that the annual audited financial statements are available on the LGIP websites. The LGIPs annual reporting dates are either June 30 or December 31.The quarterly unaudited and annually audited financial statements are prepared in accordance with accounting standards generally accepted in the United States of America. External audits may not catch all instances of accounting errors and do not provide an absolute guarantee of accuracy. Item 14: Client Referrals and Other Compensation A. Economic Benefits Provided by Third Parties for Advice Rendered to Clients (Includes Sales Awards or Other Prizes) Public Trust does not receive any economic benefit, directly or indirectly, from any third party for advice rendered to its clients. B. Compensation to Non-Advisory Personnel for Client Referrals Public Trust has entered into a solicitation arrangement with a third-party firm pursuant to that representatives of their firm can offer Public Trust services to public entities.Through this arrangement,Public Trust pays a cash referral fee to the solicitor or soliciting firm based on a percentage of revenue collected from the client.The solicitation agreement is in writing and complies with the requirements of Rule 206(4)-3 of the Advisers Act of 1940. If a client is introduced to Public Trust by a solicitor,Public Trust pays that solicitor a fee in accordance with the requirements of Rule 206(4)-3 of the Advisers Act of 1940 and any corresponding state securities law requirements.While the specific terms of each agreement can differ,the compensation generally will be based upon the engagement of new clients by Public Trust Form ADV 2A Version: 4/30/2021 21 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC um TRUST ADVISORS Investment Management Services for the Public Sector as well as the retention of those clients. Compensation is calculated using a varying percentage of the fees paid to Public Trust by such clients.Any such fee shall be paid solely from the Public Trust investment management fee and shall not result in any additional charge to the client. Each prospective client referred to Public Trust under such an arrangement receives a copy of the Public Trust firm brochure and a separate solicitation disclosure document disclosing the nature of the relationship between the third-party solicitor and Public Trust as well as an explanation of how any referral fee is to be determined and paid by Public Trust to the solicitor. Item 15: Custody SMA clients should receive statements on at least a quarterly basis directly from the qualified custodian that holds and maintains their assets.Public Trust performs an annual review with each SMA client to attempt to confirm they are receiving, at a minimum, quarterly statements directly from their qualified custodian. Clients are urged to carefully review all custodial statements and compare them to any account reports provided by Public Trust. In certain cases, the reports from Public Trust can vary from custodial statements based on accounting procedures, reporting dates, valuation methodologies and pricing sources utilized for certain securities. LGIP and Term Series Participant accounts receive, at a minimum, audited financial statements within 120 days of the LGIP fiscal year end. Each LGIP Board, or a designated recipient for the LGIP,will receive,at a minimum, quarterly statements from their qualified custodian. Item 16: Investment Discretion For accounts where Public Trust is granted discretionary authority in writing,Public Trust will normally determine (without first obtaining client's permission for each transaction) the type of securities to be bought and sold;the dollar amounts of the securities to be bought and sold;the broker-dealers through which transactions will be executed;whether a client's transaction should be combined with those of other clients and traded as a"block;"and the commission rates and/or transactions costs paid to effect the transactions. For non-discretionary accounts, Public Trust provides suggestions for securities purchased and/or portfolio recommendations to the client and, if agreed upon for investment, implements the transactions. Form ADV 2A Version: 4/30/2021 22 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C3181A2C0 PUBLIC iI'i TRUST ADVISORS Investment Management Services for the Public Sector Item 17: Voting Client Securities (Proxy Voting) Public Trust will not ask for nor accept voting authority for client securities. Further, the types of securities purchased for clients'accounts are non-equity securities that typically do not have voting rights. Item 18: Financial Information A. Balance Sheet Public Trust does not solicit prepayment of more than $1,200 in fees per client six months or more in advance and therefore is not required to provide,and has not provided,a balance sheet. B. Bankruptcy Petitions in Previous Ten Years Public Trust has not been the subject of a bankruptcy petition in the last ten years. Form ADV 2A Version: 4/30/2021 23 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 ;-; r Appendix B DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLTRU-01 MFITZ ACORO" CERTIFICATE OF LIABILITY INSURANCE DATE1/4/2 D/YYYY) 1/4/2021 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER.THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S),AUTHORIZED REPRESENTATIVE OR PRODUCER,AND THE CERTIFICATE HOLDER. IMPORTANT: If the certificate holder is an ADDITIONAL INSURED,the policy(ies)must have ADDITIONAL INSURED provisions or be endorsed. If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy,certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). PRODUCER CONTACTMe han Fitzsimmons Rust Insurance Agency,LLC PHONE 9 Fax 1510 H Street NW (NC,No,Ext):pm776-5015 (A/C,No): 5th Floor Mass,mfitzsimmons@rustinsurance.com Washington,DC 20005 INSURER(S)AFFORDING COVERAGE NAIC# INSURER A:Continental Casualty Company 20443 INSURED INSURER B:Transportation Insurance Co.(CNA) 20494 Public Trust Advisors,LLC INSURER C:St.Paul Mercury Insurance Co. 24791 717 17th Street Suite 1625 and 1850 INSURER D:Twin City Fire Insurance Co. 29459 Denver,CO 80202 INSURER E: INSURER F: COVERAGES CERTIFICATE NUMBER: REVISION NUMBER: THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES.LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. INSR TYPE OF INSURANCE ADDL SUER POLICY NUMBER POLICY EFF POLICY EXP LIMITS LTR ,INSD WVD, (MM/DD/YYYYJ (MM/DD/YYYY) A COMMERCIAL GENERAL LIABILITY EACH OCCURRENCE $ 1,000,000 CLAIMS-MADE OCCUR 6045362937 1/1/2021 1/1/2022 DAMAGETORENTED 300,000 PREMISES(Ea occurrence) $ MED EXP(Any one person) $ 10,000 PERSONAL&ADV INJURY $ 1,000,000 GEN'L AGGREGATE LIMIT APPLIES PER: GENERAL AGGREGATE $ 2,000,000 POLICY LOC PRODUCTS-COMP/OP AGG $ 2,000,000 OTHER: • $ A AUTOMOBILE LIABILITY COMBINED SINGLE LIMIT 1,000,000 _IF,g accident) ANY AUTO 6045362937 1/1/2021 1/1/2022 BODILY INJURY(Per person) $ — OWNED SCHEDULED AUTOS ONLY AUTOS BODILY INJURY(Per accident) $ X AUTOS ONLY X NON-OWNEDS (Peer accident DAMAGE $ A X UMBRELLA LIAB X OCCUR EACH OCCURRENCE _ $ 4,000,000 EXCESS LIAB CLAIMS-MADE 6045362971 1/1/2021 1/1/2022 AGGREGATE $ 4,000,000 DED X RETENTION$ 10,000 $ B WORKERS COMPENSATION X I PEAR TUTE ERH AND EMPLOYERS'LIABILITY 1,000,000 ANY PROPRIETOR/PARTNER/EXECUTIVE Y/N 6050517919 1/1/2021 1/1/2022 E.L.EACH ACCIDENT $ FFICER/MEMBER EXCLUDED? I N/A (Mandatory in NH) E.L.DISEASE-EA EMPLOYEE $ 1,000,000 It yes,describe under 1,000,000 DESCRIPTION OF OPERATIONS below E.L.DISEASE-POLICY LIMIT $ C Errors&Omissions 106654286 1/1/2021 1/1/2022 $500,000 Retention 10,000,000 D Excess Professional 42DCO288129 1/1/2021 1/1/2022 10,000,000 DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES(ACORD 101,Additional Remarks Schedule,may be attached if more space Is required) EPLI Liability:$1,000,000/$150,000 Deductible Fiduciary Liability:$1,000,000/$5,000 Deductible D&O Liability:$10,000,000/$500,000 Deductible Crime:$1,000,000/$25,000 Deductible Cyber:$5,000,000/$75,000 Deductible CERTIFICATE HOLDER CANCELLATION SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE EVIDENCE OF INSURANCE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POLICY PROVISIONS. AUTHORIZED REPRESENTATIVE ACORD 25(2016/03) ©1988-2015 ACORD CORPORATION. All rights reserved. The ACORD name and logo are registered marks of ACORD DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Appendix DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 PUBLIC II I ADVISORS TRUST Investment Management Services for the Public Sector PUBLIC TRUST ADVISORS, LLC PRIVACY POLICY Last Updated: April 1, 2020 Introduction Protecting client information is of critical importance to Public Trust Advisors, LLC (Public Trust). The U.S. Securities and Exchange Commission has adopted Regulation S-P, Privacy of Consumer Financial Information, governing the treatment of non-public personal information about clients by brokers, dealers, and investment advisors. Regulation S-P requires financial institutions, including Public Trust, to provide notice to current clients and prospective clients about their policies and practices concerning the collection and use of client, non-public information. Public Trust has adopted the following privacy policy to protect the nonpublic personal information of its clients. This privacy policy notice is given to all prospective clients of Public Trust upon entering into an investment advisory agreement and annually thereafter. We value our clients' trust and confidence and want you to understand what information Public Trust obtains, how we use this information, and how it is protected. The purpose of a privacy policy is to provide administrative, technical, and physical safeguards that assist employees in maintaining the confidentiality of nonpublic personal information collected from the clients of an investment adviser. All nonpublic personal information, whether relating to an adviser's current or former clients, is subject to the privacy policy. Any doubts about the confidentiality of client information must be resolved in favor of confidentiality. Non-Disclosure of Client Information Public Trust maintains safeguards to comply with federal and state standards to guard each client's nonpublic information. We do not share any nonpublic information with any nonaffiliated third parties except in the following circumstances: 7 As necessary to provide the service that the client has requested or authorized or to maintain and service the client's account; and 1111 As required by regulatory authorities or law enforcement officials who have jurisdiction over the investment adviser or as otherwise required by any applicable state open records law; and 7 To the extent reasonably necessary to prevent fraud and unauthorized transactions. What Information Public Trust Obtains Public Trust has a duty to protect the nonpublic personal information of its clients and to disclose to such clients the policies and procedures for protecting that information. Nonpublic personal information includes nonpublic "personally identifiable financial information" plus any list, description, or grouping of customers that is derived from nonpublic personally identifiable financial information. Such information may include financial information about our clients, information relating to services .11111111111111111111111111111Pr/ DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • _PUBLIC �II'I TRUST ADVISORS Investment Management Services for the Public Sector performed for or transactions entered into on behalf of clients, and data or analyses derived from such nonpublic personal information. Other information may include new account forms containing names, addresses, phone numbers, email addresses, custodial account information, and securities holdings information. How We Use the Information We may share personal information we collect about our clients, prospects, and former clients to service providers such as: Unaffiliated service providers such as securities clearing houses, printers for delivery of statements, software firms, and other administrative services associated with your account(s). 71 Government agencies such as state securities divisions, tax reporting, or court orders. 7 Other organizations as permitted by law that protect your privacy such as fraud prevention. W Our registered representative(s) who may be independent correspondents of Public Trust. In most instances, Public Trust requires these unaffiliated service providers to execute non-disclosure agreements to further protect client nonpublic information. How it is Protected Public Trust is committed to protecting nonpublic client information and considers this safeguarding of information a priority. We have adopted polices based on the National Institute of Standards and Technology (NIST) framework designed to prevent unauthorized access to our clients' information. Access to client information is restricted to Public Trust employees, registered representatives, and designated software service providers used for legitimate business purposes. Public Trust restricts access to nonpublic client information to only those employees and software service providers who need to know such information to provide services to our clients. Any employee or software vendor who is authorized to have access to nonpublic client information is required to keep such information in a secure compartment or receptacle as of the close of business each day. All electronic or computer files containing such information shall be password protected and secured behind a corporate firewall protected from access by unauthorized persons. If you have any questions about the Public Trust Privacy Policy or concerns about any nonpublic personal information, please feel free to contact us at: Public Trust Advisors, LLC Compliance Department 717 17th Street, Suite 1850 Denver, CO 80202 (303) 295-0777 www.publictrustadvisors.com DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Appendix DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 F PUBLIC® CTRUST lORS F./ € s -ti YrlN i\ % ,\. \\i«\S„i't'\ y/\`"' r .r 3,�t\/`. ...-...�,1 A \\ '. \\ 1 } • - v <`' a'�":. _, -, .-t, r - , ,,,:.t t,+,..1..,i.iai.. .tl�t!�fir:-„l i,,ASa#.1 a,,1fa �:\ "•.,--- • •I, fr- - i . ,it-/..."7--—''''''.....'''.---.. .-. ' -''.'r'47" '''' -4'- .- ' . 2. �`-\ 34r o� �y f , � • • !f �. u c , ua 111 0 o e a o ara `_ '".' .S +r.;4. h <,-.,, _ .Q a ,;.,�� : r�^r�i..., --r=- _c=. 4^W ' ' ,:C \. sf �'" i. ....�c— r t r. 3 .a S' _ _ '.K i , - s k} a. �* i` t 45'" '. 'r -^za'' ' ^ .p o i' # } Sample Client Portfolio LT 1-3 06/01/2020 to 06/30/2020 Investment Report DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 .iy ' "_.� �l. • "" `' \, `'', Table of Contents �` A. ti. � R f' � h tq 4 `� ' \ ``` Executive Summary 4..,'� 1 v A ''\ •, �t a • Portfolio Overview ' ,(� S \t: \� • Maturity Distribution ' ,ti fI / � to • Rating Distribution , f I1 .,- •' P c `l • Security Distribution Market Value + t ' • Security Distribution-Historical Cost '* \ r ' Supporting Reports ! K. ` - ,,\ • Portfolio Holdings ) • Transactions 1 I , , d • Income t, / . • v ,,.• `,to i • GASB 40 1 " I i {_a • Portfolio Activity Summary {' 'i \f= Disclaimer n ,. \ ,`. t J ; Relationship Management Team 1 j 1 . III 't Relationship Managers Portfolio Manager I , \ l.** John Grady I Manging Director Neil Waud,CFA I Chief Investment Officer I f \ r Direct:(407)588-0525 Direct:(303)244-0468 I `r '` iiis ' Mobile:(407)701-8002 Mobile:(720)255-7404 ' i ice` �I john.grady@publictrustadvisors.com neil.waud@publictrustadvisors.com t i I+{) �,� 1. ., 1 illt. 11 \ . ;� i Tom Tight I Manging Director Cory Gebel,CFA I Director,Portfolio Management i ' i Direct:(407)588-939I Direct:(720)845-5788 I `` Mobile:(407)765-0761 cory.gebel@publictrustadvisors.com I 1 • \f,_ i M tom.tight@publictrustadvisors.com lit 1 'HH • ,�t :- , ' , • \ I 1 i it it l \\ �'9..0_...: DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Po rtfo I i o Overview 06/0 I/2020 to 06/30/2020 Portfolio Characteristics Portfolio Summary 05/31/20 06/30/20 Summary 05/31/20 06/30/20 Duration 1.252 1.475 Historical Cost $136,612,891.60 $137,624,893.23 Years to Effective Maturity 1.313 1.543 Book Value 136,760,106.95 137,763,016.58 Years to Final Maturity 1.323 I.552 Accrued Interest 638,280.04 617,642.49 Coupon Rate 2.046 1,876 Net Pending Transactions 777,642.82 2.29 Book Yield 1.875 1.650 Book Value Plus Accrued $138,176,029.81 $138,380,661.35 Market Yield 0.269 0.242 Net Unrealized Gain/Loss 2,363,536.55 2,208,344.50 Benchmark Yield 0.222 0.204 Market Value Plus Accrued $140,539,566.36 $140,589,005.85 Asset Allocation Income Summary .. Period Income Income . Interest Income $223,075.76 Net Amortization/Accretion Income (18,898.31) i♦ CASH:B.00% i Net Realized Gain/Loss 454.09 lil CORP 4,06%u Net Income _. I♦ GSE44,30% $204,631.54 i INMMFUND O:40% 'US GQV 44.243/4: Detail may not add to total due to rounding. Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Portfolio Overview 06/01/2020 to 06/30/2020 Maturity Distribution by Security Type Security 0-3 Months 3-6 Months 6-9 Months 9-12 Months 1-2 Years 2-3 Years 3-4 Years 4-5 Years 5+Years Portfolio Total Distribution CASH $2.29 — -- -- -- -- -- -- -- $2.29 CORP 363,211.21 1,376,620.98 3,217,036.03 8,835,341.65 1,756,234.02 15,548,443.89 FED INST(GSE) 6,556,709.68 759,886.65 4,288,607.42 19,707,771.57 30,970,369.62 62,283,344.94 MMFUND 557,496.43 557,496.43 US GOV 1,509,751.99 8,287,646.34 7,383,302.40 5,11 1,312.92 33,182,791.88 6,724,912.78 62,199,718.31 TOTAL $2,067,250.71 $15,207,567.23 $9,519,810.03 $12,616,956.37 $61,725,905.10 $39,451,516.42 — -- — $140,589,005.85 • Top Ten Holdings Maturity Distribution by Type . Issuer Value 50% - -- -- ., - United States 44.24% 43.9% Federal Home Loan Banks 18.15% Freddie Mac 13.64% 40°/n' ' Farm Credit Funding Corporation 8.75% Federal National Mortgage Association 3.76% 30% 28.1%. Chevron Corporation 2.57% EGASH'0.00010 Apple Inc. 2.51% '?I CORP'1.1,06%; U.S,Bancorp 1.33% 20%• .11 GSE 44.300k Toyota Motor Corporation 1.20% ®"MMFUND 0;40% ".10.86/0 •.US GOV•44.24%- Cisco Systems,Inc. 0.98% 9,0% r - - ■ 1.5% I .0-3 3-6 - 6-.9 9-12 1-2• 2-3 3-4 '4-5 5 - Monttl&. Months ,Mol2ths- ',Mpnttp ,Years Years Years, Years Years Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Portfolio Overview 06/01/2020 to 06/30/2020 S&P Rating Distribution Moody's Rating Distribution S&P Rating Distribution Jun 30,2020 Portfolio Moody's Rating Distribution Jun 30,2020 Portfolio Ending Balance Allocation Ending Balance Allocation Short Term Rating Distribution Short Term Rating Distribution A-I+ $0.00 0.00% P-I $0.00 0.00% A-I P-2 A-2 Total Short Term Ratings $0.00 0.00% Total Short Term Ratings $0.00 0.00% Long Term Rating Distribution Long Term Rating Distribution Aaa $126,445,349.50 89.94% AAA $1,962,286.25 1.40% Aa $7,963,063.16 5.66% AA $134,848,493.54 95.92% A $6,180,593.19 4.40% A $3,778,226.06 2.69% Below A Below A Not Rated Not Rated Total Long Term Ratings $140,589,005.85 100.00% Total Long Term Ratings $140,589,005.85 100.00% Portfolio Total $140,589,005.85 100.00'0 Portfolio Total $140,589,005.85 100.00% Allocation by Standard and Poor's Rating Allocation by Moody's Rating f' tt r li AAA 1.4Vo A i' Ada i39.94a/o- iJ '; AA 95.92%0 ;;-' Aa 5.669/a !i 1. A 2:69%. 'U A'4.4% 1. /1 Sample Client Portfolio LT 1-3 Public Trust Advisors sO DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Portfolio Overview 06/01/2.02.0 to 06/30/2020 Market Value Basis Security Distribution Security Distribution May 31,2020 May 31,2020 Jun 30,2020 Jun 30,2020 Change in Book Yield Ending Balance Portfolio Allocation Ending Balance Portfolio Allocation Allocation Cash $777,642.82 0.55% $2.29 0.00% (0.55%) 0.00% U.S.Treasury Notes $71,264,999.00 50.71% $62,199,718.31 44.24% (6.47%) 2.36% Federal Instrumentality(GSE) 46,423,950.19 33.03% 62,283,344.94 44.30% 11.27% 0.91% Money Market Funds $313,658.49 0.22% $557,496.43 0.40% 0.17% 0.01% - Corporate Notes 21,759,315.86 15.48% 15,548,443.89 11.06% (4.42%) 1.87% Portfolio Total - $140,539,566.36 ~�^^•100.00% ,-�—$140,589,005.85 100.00% - I Asset Balance by Security Type $99-mm- $80 m1n,_ . $70 mm- $62.2 $62.3- $6o rim•- ._ - - - i ---l- r< 4 - k: t:I $50 mm $46.4 a r t} May 3i,202p. $40 mm'- —-- —— — - i r -,,ay it kr e __-. _-- - _ __._ _----- Jun 30,.2020 *30 mm- r$ 1 p Imo. ., ) ors, ,.i _-----' $iomm- I, , `` IV� ,J tp .r7 . $o mm. $0.8 $OA $0,3 $0.6 �`. . CASH. MMF UST GSE' CORP Sample Client Portfolio LT 1-3 Public Trust Advisors O DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Portfolio Overview 06/01/2020 to 06/30/2020 Historic Cost Basis Security Distribution Security Distribution May 31,2020 May 31,2020 Jun 30,2020 Jun 30,2020 Change in Book Yield Ending Balance Portfolio Allocation Ending Balance Portfolio Allocation Allocation Cash $777,642.82 0.57% $2.29 0.00% (0.57%) 0.00% U.S.Treasury Notes $69,231,580.19 50.39% $60,232,439.55 43.77% (6.62%) 2.36% Federal Instrumentality(GSE) 45,772,267.49 33.32% 61,661,399.08 44.80% 11.49% 0.91% Money Market Funds $313,658.49 0.23% $557,496.43 0.41% 0.18% 0.01% Corporate Notes 21,295,385.43 15.50% 15,173,558.18 11.03% (4.47%) 1.87% Portfolio Total $137,390,534.43 100.00% $137,624,895.52 100.00% 1.65% Asset Balance by Security Type $90 mm - - - - - $80 mm- $70 mm- $69.2_ $60.2 $61.7 $60 trim, - ; — $50 mm- ! $45;8 I il.May 31;2020 $40 mm:- (31 Jun 30, 2020• $30 mm- $20 Inn)- ? $21.3' - - - --- - '$15.2 $lomm- fi ' $o MIT) $0.8 •$0.0 r $0.3 $0.6 'r r rI CASH: MMF UST GSE' CORP Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Portfolio Holdings 06/01/2020 to 06/30/2.020 Description Effective Maturity Trade Date Par Value Original Cost Market Value MV+Accrued Net Unrealized%of Market Callable Book Yield S&P Identifier Final Maturity Settle Date Book Value Market Price Accrued Balance Gain/Loss Value Next Call Date YTM Moody's Coupon Duration YTC CASH Receivable 06/30/20 0.00% -- AAA CCYUSD 06/30/20 2.29 $2'29 $2.29 $2'29 $0.00 0.00% N - -- $2.29 1.00 $0.00 -- Aaa 0.00% 0.00 • $2.29 $2.29 $2,29 N AAA CASH TOTAL • 06/30/20 2.29 $229 1.00 $000 $0.00 0.00% -- Aaa I 0.00 -- . . -- -- MMFUND FIRST AMER:TRS OBG Y 06/30/20 0.01% 31846V807 06/30/20 -- 557,496.43 $557,496.43 $557,496.43 $557,496.43 N AAAm 0.01% 0.00 -- $557,496.43 1.00 $0.00 $0.00 0.40% -- Aaa -- 06/30/20 __ r 0.01% $557,496.43 $557,496.43 $557,496.43 N AAAm J 'MMFUND TOTAL 06/30/20 557,496.43 $0.00 0.40% -- ,496.43 1.00 ' $0.00 -- Aaa 1 US GOV UNITED STATES TREASURY 09/15/20 1.53% 09/15/17 $1,493,320,32 $1,503,699.00 $1,509,751.99 N AA+ 9128282V 1 09/15/20 09/19/17 I,500,000.00 $I,499,529.74 100.25 $6,052.99 $4,169.26 I.07% 0.20% Aaa 1.38% 0.21 -- • UNITED STATES TREASURY 09/30/20 - 1.92% 12/05/17 2,480,607.44 2,486,189.48 2,498,632.10 N AA+ 912828VZ0 09/30/20 12/07/17 2,475,000.00 2,475,509.08 100.45 12,442.62 10,680.39 1.78% 0-- .20% Aaa 2.00% 0.25 . -- UNITED STATES TREASURY 10/3 I/20 1.59% 1 1/02/15 1,007,578.12 1,005,167.00 I,008,1 15.37 N AA+ 9I2828WC0 10/31/20 11/05/15 I,000,000.00 1,000,522.01 100.52 2,948.37 4,644.99 0.72% 0-- .20% Aaa 1.75% 0.33 -- UNITED STATES TREASURY I I/15/20 2.73% 07/26/18 3,990,468.76 4,035,936.00 4,049,346.33 N AA+ 912828P.C8 1 1/15/20 07/30/18 4,000,000.00 3,998.429.36 100.90 13,410.33 37,506.64 2.88% 0-- .23% Aaa 2.62% 0.37 -- UNITED STATES TREASURY 1 I/30/20 1.99% 12/27/17 725,254,88 730.324.40 731,552.54 N AA+ 912828A42 I I/30/20 12/28/17 725,000.00 725,037.76 100.73 1,228.14 5,286.64 0.52% 0-- .24% Aaa 2.00% 0.42 - UNITED STATES TREASURY 02/15/21 2.5 I 04/17/18 3,375,695.30 3,443,829.40 3,472,621.98 N AA+ 9128283X6 02/15/21 04/19/18 3,400,000.00 3,394,505.41 101.29 28,792.58 49,323.99 2.47% 0-- .19% Aaa 2.25% 0.62 -- UNITED STATES TREASURY 03/15/21 2.49% 03/21/l8 3,812,449.22 3,884,019.75 3,910,680.42 N AA+ 9I28284B3 03/15/21 03/23/18 3,825.000.00 3,821,944.47 101.54 26,660.67 62,075.28 2.78% 0-- .20% Aaa 2.38% 0.70 -- UNITED STATES TREASURY 04/.15/21 2.53% 04/17/18 4,978,5 15.65 5,086,330.00 5,1 1 1,3 12.92 N AA+ 9I 28284G2 04/15/21 04/19/18 5,000.000.00 4,994,174.74 101.73 24,982.92 92,155.26 3.64% 0-- .19% Aaa 2.38% 0.79 -- Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Po rtfo I i o Holdings 06/0 I/2020 to 06/30/2020 Description Effective Maturity Trade Date Par Value Original Cost Market Value MV+Accrued Net Unrealized%of Market Callable Book Yield S&P Identifier Final Maturity Settle Date Book Value Market Price Accrued Balance Gain/Loss Value Next Call Date YTM Moody's Coupon Duration YTC UNITED STATES TREASURY 07/15/21 2.90% 09/24/18 7,222,142.61 7,459,435.80 7,547,575.22 N AA+ 912828Y20 07/15/21 09/26/18 7,275,000.00 7,254,976.66 102.54 88,139.42 204,459.14 5.37% - 0.19% Aaa 2.62% 1.02 -- UNITED STATES TREASURY 08/15/21 2.90% 09/24/18 7,218,281.25 7,535,177.62 7,594,162.43 N AA+ 912828RC6 08/15/21 09/26/18 7,375,000.00 7 312,505.85 102.17 58,984.80 222,671.78 5.40% 0.19% Aaa ' 2.12% 1.1 I -- UNITED STATES TREASURY 09/30/2I 2.69% 12/17/18 4,728,187.49 4,916,251.20 4,941,890.54 N AA+ 912828F21 09/30/21 12/20/18 4,800,000.00 4,767,116.87 102.42 25,639.34 149,134.33 3.52% 0-- .19% Aaa 2.12% 1.23 -- UNITED STATES TREASURY 10/31/21 1.60% 01/08/20 1,384,829.1 I 1,408,515.62 1,413,148.78 N AA+ 912828F96 10/31/21 01/10/20 1,375,000.00 1,382,285.45 102.44 4,633.15 26,230.17. 1.01% 0.17% Aaa • -- 2.00% 1.32 ' -- UNITED STATES TREASURY 1 1/15/21 2.70% 12/17/18 4,722,949.22 4.873,495.80 4,890,753.61 N AA+ 9128285L0 11/15/21 4,700,000.00 162,396.96 3.48% 0.19% 2.88% 1.35 12/20/18 4,71 1,098.84 103.69 17,257.81 -- Aaa -- UNITED STATES TREASURY 03/31/22 1.61% 12/02/19 2,006,562.50 2,055,000.00 2,063,797.81 N .AA+ 912828J76 03/31/22 2,000,000.00 50,031.34 1.47% 0.18% 1.75% 1• .72 12/03/19 2,004,968.66 102.75 8,797.81 -- Aaa UNITED STATES TREASURY 05/I5/22 1.61% 12/02/19 2,006,796.88 2,059,062.00 2,063,532.11 N AA+ 9128285V3 05/15/22 12/03/19 2,000,000.00 2,005,220.69 102.95 4,470.11 53,841.31 1.47% 0-- .17% Aaa 1.75% I.85 -- UNITED STATES TREASURY 05/31/22 1.63% 10/30/19 1,584,843.75 1,626,310.35 1,628,811.63 N AA+ , 912828XD7 05/31/22 10/31/19 1,575,000.00 1,582,346.42 103.26 2,501.28 43,963.93 1.16% 0.17% Aaa 1.88% 1.89 - UNITED STATES TREASURY 06/30/22 1.60% 1 1/25/19 1,013.242.19 1,039,062.00 1,039,1 19.74 N AA+ 912828XG0 06/30/22 11/26/19 I,000,000.00 1,010,245.05 103.91 57.74 28,816.95 0.74% - 0.17% Aaa 2.12% 1.97 -- UNITED STATES TREASURY 08/15/22 1.55% 01/17/20 1,101,933.59 1,133,944.90 1,140,672.58 N AA+ 912828TJ9 08/15/22 I,100,000.00 32,337.28 0.81% 0.17% 1.62% 2.09 01/21/20 I,101,607.62 103.09 6,727.68 -- Aaa UNITED STATES TREASURY 08/15/22 1.61% 12/30/19 997,304.69 1,028,281.00 1,033,926.60 NAA+ 912828YA2 08/15/22 12/3 I/19 1,000,000.00 997,815.74 102.83 5,645.60 30,465.26 0.74% 0.17% Aaa -- 1.50% 2.09 -- UNITED STATES TREASURY 08/31/22 1.59% 09/27/19 3,002,578.14 3,094,218.00 3,1 1.0,512.16 N AA+ 912828258 08/31/22 09/30/19 • 3,000,000.00 3,001,934.73 103.14 16,294.16 92,283.27 2.21% 0-- .17% Aaa 1.62% 2.13 -- UNITED STATES TREASURY 01/31/23 1.67% 12/16/19 1,378,898.44 1,426,4 12.70 1,439,801.44 N AA+ 9128283U2 01/31/23 12/17/19 1,350,000.00 I,374,015.90 105.66 13,388.74 52,396.80 1.02% 0-- .18% Aaa 2.38% 2.50 -- Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Portfolio Holdings 06/0 I/2020 to 06/30/2020 Description Effective Maturity Trade Date Par Value Original Cost Market Value MV+Accrued Net Unrealized%of Market Callable Book Yield S&P Identifier Final Maturity Settle Date Book Value Market Price Accrued Balance Gain/Loss Value Next Call Date YTM Moody's Coupon Duration YTC • • 08/21/21 __ 2.36% $60,232,439.55 $61,830,662.02 $62199,718.31 N AA+ US GOV TOTAL 08/21/21 60,475,000.00 $1,414,870.98 44.24% 0.19% { 1.13 ' - -- Aaa J GSE FEDERAL HOME LOAN I I/17/20 2.01 MORTGAGE CORP 12/05/17 $6,474,845.00 $6,541,813.85 $6,556,709.68 N AA+ 1 1/17/20 6,500,000.00 $45,115.45 4.66% 0.18% 3I37EAEK I 0.38 12/07/17 $6,496,698.40 100.64 $14,895.83 -- Aaa 1.88% FEDERAL NATIONAL 04/13/21 2.82% • MORTGAGE ASSOCIATION 07/26/18 3,966,800.00 4,073,082.28 4,094,748.95 04/13/21 4,000,000.00 82,938.82 2.91% 0.17% 3135G0U27 078 07/30/18 3,990,143.46 - 101.83 21,666.67 Aaa 2.50% - FEDERAL HOME LOAN 01/13/22 I.65% MORTGAGE CORP 11/15/19 659,932.00 671,669.10 678,873.26 N AA+ 01/13/22 650,000.00 14,556.49 0.48% 0.20% 3 137EADB2 1.5011/18/19 ,1 12.60 103.33 7,204.17 -- Aaa -- 2.38% FEDERAL HOME LOAN BANKS 03/I 1/22 0.97% • 03/02/20 2,050,940.00 2,066,1 19.02 2,079,869.02 N AA+ 313378CR0 03/11/22 03/04/20 2,000,000.00 2,042,833.97 103.31 13,750.00 23,285.05 1.48% 0-- .30% Aaa 2.25% 1.66. • - FEDERAL FARM CREDIT 04/08/22 0.45% BANKS FUNDING CORP 04/03/20 2,995,560.00 3,008,063.91 3,010,657.66 N AA+ 04/08/22 3,000,000.00 11,996.12 2.14% 0.22% 3I33ELWD2 176 04/08/20 2,996,067.79 100.27 2,593.75 -- Aaa -- 0.38% FEDERAL FARM CREDIT 04/2I/22 - 0:33% BANKS FUNDING CORP 04/21/20 3,074,400.00 3,072,051.39 3,081,268.06 N AA+ 04/21/22 3,000,000.00 4,757.58 2.19% 0.25% 3I33ELJC9 1.78 04/22/20 3,067,293.8I 102.40 9,216.67 -- Aaa 1.58% FEDERAL HOME LOAN BANKS 06/03/22 0.27% 06/15/20 5.998,140.00 6,002,022.36 6,002,814.03 N AA+ 3130AJPU7 06/03/22 06/16/20 6,000,000.00 5,998,178.68 100.03 791.67 3.843.68 4.27% 0.23% Aaa 0.25% 1.92 -- FEDERAL HOME LOAN 06/08/22 0.26% MORTGAGE CORP 06/1 1/20 2,749,340.00 2,747,268.29 2,747,707.52 N AA+ 3134GVJ66 06/08/22 06/12/20 2,750,000.00 2,749,357.19 99.90 439.24 (2,088.90) 1.95% -- 0.30% Aaa 0.25% 1.93 FEDERAL HOME LOAN BANKS 06/10/22 0.24% 05/1 1/20 I,870,092.00 1,864.671.17 1,866,902.42 N AA+ 313379Q69 06/I0/22 05/12/20 I,800.000.00 1,865,543.89 103.59 2,231.25 (872.72) 1.33% 0.27% Aaa 2.12% 1.91 -- FEDERAL HOME LOAN BANKS09/09/22 1.57% 09/09/19 1,771,700.00 1,817,717.90 1,828,606.78 N AA+ 3I3380GJ0 09/09/22 09/12/19 1,750,000.00 1,765,983.66 103.87 10,888.89 51,734.23 1.30% 0.23% Aaa • 2.00% 2.14 -- Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Portfolio. Holdings 06/01/2020 to 06/30/2020 Description Effective Maturity Trade Date Par Value Original Cost Market Value MV+Accrued Net Unrealized%of Market Callable Book Yield S&P Identifier Final Maturity Settle Date Book Value Market Price Accrued Balance Gain/Loss Value Next Call Date YTM Moody's Coupon Duration YTC FEDERAL FARM CREDIT I I/01/22 0.45% BANKS FUNDING CORP 03/30/20 1,458,660.00 1,459,894.49 1,464,747.83 N AA+ 1 1/01/22 1,400,000.00 6,862.04 1.04% 0.24% 3133EHM9I 228 03/31/20 1,453,032.46 104.28 4,853.33 -- Aaa -- 2.08% FEDERAL HOME LOAN BANKS 12/09/22 0.41% 7,465,214.00 7,478,985.74 7,487.235.74 N AA+ 313381 BR5 12/02/22 7,200,000.00 �23,516.49' 5.33% 0.28% 1.88% 2.39 -- 7,455,469.26 , • 103.87 8,250.00. - Aaa FEDERAL HOME LOAN BANKS 02/17/23 0.38% 04/21/20 4,1 10,840.00 4,117,676.68 4,137,537.79 N AA+ 3130AJ7E3 02/17/23 04/23/20 4,000,000.00 4,103,466.10 102.94 19,861.I I 14,210.58 2.94% 0.25% Aaa 1.38% 2.58 -- FEDERAL FARM CREDIT 02/21/23 • 145% BANKS FUNDING CORP - .02/14/20 2,000,180.00 • 2,060,718.72 2,071,190.94 N AA+ ' 02/21/23 2,000,000,00 60,559.93 1.47% 0.30% 3I33ELNW0 2 59 ' 02/21/20 2,000,158.79 103.04 10,472.22 -- Aaa 1.45% FEDERAL FARM CREDIT 03/08/23 0.48% BANKS FUNDING CORP 03/30/20 2,657,600.00 2,657,307.12 2,678,102.26 N AA+ 03/08/23 2,500,000.00 13,000.60 1.90% 0,30% 3133EJFK0 2 59 03/31/20 2,644,306.52 106.29 20,795.14 -- Aaa 2.65 FEDFKOMELOAN H BANKS 03/10/23 - 1.45% • 02/14/20 2,040,460.00 2,096,925.40 2,1 I0,029.57 N ' AA+ 3133 I 03/10/23 02/18/20 2,000,000.00 2,035,689.30 104.85 13,104.17 61,236.10 1.50% ' • 0,32% Aaa 2,61 -- FEDERAL HOME LOAN 04/20/23 0.43% MORTGAGE CORP 04/21/20 3,494,050.00 3,509,549.50 3,512,138.05 N AA+ 04/20/23 3.500,000.00 15,121.57 2.50% 0.28% 3 I37FAEQ8 2.79 04/22/20 3,494,427.94 100.27 2,588.54 -- Aaa -- 0.38% FEDERAL NATIONAL 05/22/23 0.32% MORTGAGE ASSOCIATION 06/02/20 998,017.00 • 998,949.84 999,220.67 OS/22/23_ 1,000,000.00882.00 0.71% 0.29% 3135G04Q3 2 88 06/03/20 998,067.84 99.89 270.83 -- Aaa 0.25% . - FEDERAL HOME LOAN 06/26/23 0.35/ MORTGAGE CORP 06/24/20 3,634,356.60 3,639,326.56 3,639,453.12 N AA+ 06/26/23 3,645,000.00 4,921.70 2.59% 0.30% 3137EAES4 2 98 06/26/20 3,634,404.86 99.84 126.56 -- Aaa -- 0.25% $59,471 126.60 $59,883,813.33 $60,047,813,36� -N AA+ GSE TOTAL 07/02/22 58,695,000.00 $435,576.80 ElI 0.25% j 1.97 $59,448,236.52 • 102.06, $164,000.03 __ Aaa GSE MBS FHMS K-013 A2 12/29/20 2.38% 03/04/19 $763,536.14 $757,404.99 $759,886.65 Y AA+ 3I37AA4W0 01/25/21 03/07/19 749,368.39 $753,282.60 101.07 $2,481.66 $4,122.39 0.54% -- -- Aaa 3.97% 0.49 -- Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Po rtfo I i o Holdings 06/0 I/2020 to 06/30/2020 Description Effective Maturity Trade Date Par Value Original Cost Market Value MV+Accrued Net Unrealized%of Market Callable Book Yield S&P Identifier Final Maturity Settle Date Book Value Market Price Accrued Balance Gain/Loss Value Next Call Date YTM Moody's Coupon Duration YTC FN AB5396 05/06/21 1.34% 08/15/12 194,134.18 193,398.30 193,858.47 N AA+ , 31417B7J0 06/01/22 08/15/12 184,067.96 I86,400.I I 105.07 460.17 6,998.19 0.14% (3.15%) Aaa -- 3.00% 0.23 - FHMS K-030 Al 08/08/21 3.01% 06/14/18 232,172.47 239,138.50 239,679.60 Y AA+ 3137B3N95 09/25/22 06/19/18 233,651.04 232,653.93 102.35 541.10 6,484.57 0.17% -- - Aaa 2.78% 1.10 -- FHMS K-026 A2 10/15/22 2.46% 05/21/19 1,000,429.69 1,040,0 I 5.20 1,042,106.87 Y AA+ 3137E I BS0 1 1/25/22 05/24/19 I.000,000.00 999,767.94 104.00 2,091.67 40,247.26 0.74% -- -- Aaa 2.51% 2.22 -- ' 12/04/21 . 2.39% 6SE MBS TOTAL 03/21/22 ._ 2,167,087.39 $2,190,272.46 $2,229,456:99 $2 235,531.58 AA+ $2,172,104.58 102.92 $5,574.59 $57,852.41 1.59% (3.15%) Aaa. 1.34 . CORP JOHNSON&JOHNSON 1 1/10/20 1.99% 1 1/08/17 $359,614.80 $362,216.71 $363,21 1.21 N AAA 478 160CH5 11/10/20 1 1/10/I7 360,000.00 $359,952.15 100.62 $994.50 $2,264.56 0.26% -- 0.24% Aaa 1.95% 0.36 -- CISCO SYSTEMS INC 02/28/21 0.56% 05/01/20 1,367,914.50 1,366,473.48 1,376,620.98 - N AA- •17275RBD3 02/28/21 05/OSl20 1,350,000.00 • 1,364,496,34 101.22 10,147.50 1,977.15 0.98% 0,35% AI 2.20% 0.65 -- TOYOTA MOTOR CREDIT 04/13/21 2.96% CORP 04/10/18 I,649,340.00 1,681,937.81 1,692,484.06 N A+ 04/13/21 1,650,000.00 32,1 15.79 1.20% 0.48% 89236TEU5 078 04/13/18 I,649,822,03 101.94 10,546.25 -- Al -- 2.95% CHEVRON CORP. . 04/16/21 3.28% I1/02/18 I,457,280,00 1,520,614.47 1.524,551.97 Y AA • 166764BG4 05/16./21 1,500,000.00 35,786.25 1.08% 0.53% 2.10% 0.48 ,484,828.22 101.37 3,937.50 04/16/21 0 37% Aa2 CATERPILLAR FINANCIAL II/12/21 0.64% SERVICES CORP 01/09/20 770,000.00 769,761.30 770.440.00 N A 1 1/12/21 770,000.00 (238.70) 0.55% 0.67% 149I3Q3D9 012 01/13/20 770,000.00 99.97 678.70 -- A3 -- 0.63 PFIZER INC 12/15/21 1.81% 717081DZ3 12/15/21 10/30/19 I,000,000.00 1,007,980.00 1,024,768.37 1,025;746.15 19,264.22 0.73% N 0.49% AA 2.20% 1.44 10/31/19 1,005,504.15 102.48 977.78 - Al -- MICROSOFT CORP 01/06/22 1.58% 02/05/20 1,015,460.18 1,031,909.66 1,041,576.33 Y AAA 594918BW3 02/06/22 1,000,000.00 19,629.90 0.74% 0,40% 2.40% 0.90 02/07/20 1,012,279.76 103.19 9,666.67 01/06/22 0 29� Aaa CHEVRON CORP 02/03/22 1.88% 10/29/19 2,027,320.00 2,069,405.74 2,085,781.52 Y 0.42% AA 166764BN9 03/03/22 10/31/19 2,000,000.00 50 48% 02/03/22 Aa2 2,019,401.31 103.47 16,375.78 ,004.43 1. 2.50% 0.95 0.31 Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Portfolio Holdings 06/0 I/2020 to 06/30/2020 Description Effective Maturity Trade Date Par Value Original Cost Market Value MV+Accrued Net Unrealized%of Market Callable Book Yield S&P Identifier Final Maturity Settle Date Book Value Market Price Accrued Balance Gain/Loss Value Next Call Date YTM Moody's Coupon Duration YTC U.S.BANCORP 02/15/22 1.96% 10/15/19 1,279,387.50 I,304,260.32 1,315,301.99 Y A+ 91159HHC7 03/15/22 1,250,000.00 33,645.94 0.94% 0.45% 3.00% 0.96 10/16/19 1,270,614.38 104.34 11,041.67 02/15/22 0.32% Al APPLE INC 04/I 1/22 1.84% 11/12/19 2,526,750.00 2,588,509.55 2,596,495.66 Y AA+ 037833CQ I 05/1 1/22 2,500,000.00 68,644.84 1.85% 0.39% 2.30% 1.06 I I/14/19 2,519,864.71 103.54 7,986.11 04/I I/22 0.30% Aal EXXON MOBIL CORP 08/16/22 1.90% 08/13/19 800,000.00 824,935.19 830,641.19 N AA 3023 I GBB7 08/16/22 08/16/19 800,000.00 800,000.00 103.12 5,706.00 24,935.19 0.59% 0-- .43% Aa I 1.90% 2.08 -- APPLE INC 05/1 1/23 0.84% 05/04/20 912,511.20 924,639.70 925,592.82 N AA+ 037833DV9 05/I 1/23 05/I I/20 915,000.00 912,624,97 101.05 953.12 12,014.73 0.66% 0.38% Aal -- 0.75% 2.83 -- 12/04/21 1.87% -- $15,173,558.18 $15,469,432.31 $15,548,443.89 AA- CORP TOTAL 12/20/21 _ 15,095,000.00 $15,169,388.00 102.50 $79,011.58 $300,044.31 11.06% -- 0.44% Aa3 1.02 0.32% I 01/14/22 1.65% -- $137,624,895.52 $139,971,363.37 $140,589,005.85 AA+ PORTFOLIO TOTAL 01/18/22 __ 136,989,586.11 $137,763,018.87 I-0I.81 $617,642.49 $2,208,344.50 100.00% _ 0.24% Aaa 1.48 0.32% Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Transactions 06/01/2020 to 06/30/2020 Description Current Units Type Trade Date Settle Date Price Principal Realized Broker Amount Identifier Gain/Loss FEDERAL NATIONAL MORTGAGE I,000,000.00 Buy 06/02/20 06/03/20 99.802 $998,0 17.00 $0.00 BONY ($998,093.39) ASSOCIATION 3 135G04Q3 FEDERAL HOME LOAN MORTGAGE CORP 2,750,000.00 Buy 06/I I/20 06/12/20 99.976 2,749,340.00 0.00 Wells (2,749,4 I 6.39) 3 134GVJ66 FEDERAL HOME LOAN BANKS 6,000,000.00 Buy 06/15/20 06/16/20 99.969 5,998,140.00 0.00 MSSB (5,998,306.67) 3I30AJPU7 FEDERAL HOME LOAN MORTGAGE CORP 3,645,000.00 Buy 06/24/20 06/26/20 99.708 3,634,356.60 0.00 TDS (3,634,356.60) 3137EAE54 FEDERAL HOME LOAN BANKS 5,000,000.00 Buy 06/22/20 06/23/20 103.902 5,195,100.00 0.00 MSSB (5,198,745.83) 313381BR5 Buy Total $18,574,9¢3.60 $0.00 ($18,578,918.88) UNITED STATES TREASURY (4.000,000.00) Sell 06/25/20 06/26/20 100.016 ($4,000,625.00) $592.02 Wells $4,032,410.72 912828XH8 Sell Total ($4,000,625.00) $592.02 $4,032,410.72 UNITED STATES TREASURY (750,000.00) Maturity 05/31/20 05/31/20 100.000 ($750,000.00) $0.00 Maturity $750,000.00 9 12828XE5 AMERICAN HONDA FINANCE CORP (1,225,000.00) Maturity 06/16/20 06/16/20 100.000 (1,225,000.00) 0.00 Maturity 1,225,000.00 02665WCH2 UNITED STATES TREASURY (5.000,000.00) Maturity 06/15/20 06/15/20 100.000 (5,000,000.00) 0.00 Maturity 5,000,000.00 912828XU9 WALMART INC (4,900,000.00) Maturity 06/23/20 06/23/20 100.000 (4,900,000.00) 0.00 Maturity 4,900,000.00 93II42EG4 FEDERAL HOME LOAN BANKS (2,650,000.00) Maturity 06/I 2/20 06/12/20 100.000 (2,650,000.00) 0.00 Maturity 2,650,000.00 3I3383HU8 Maturity Total $0.00 $14,525,000.00 FHMS K-01'3 A2 (631.61) Principal 06/01/20 06/01/20 ($631.61) ($3.84) Direct $631.61 3137AA4W0 Paydown FHMS K-030 Al (8,472.50) Principal 06/01/20 06/01/20 (8,472.50) 36.94 Direct 8,472.50 3137B3N95 Paydown FN AB5396 (12,708.58) Principal 06/01/20 06/01/20 (12,708.58) (171.02) Direct 12,708.58 31417B7J0 Paydown Principal Paydown Total --_-- —_--- — ($21,812.69) ($137.93) $21,812.691 • Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Income 06/01/2020 to 06/30/2020 Description Final Current Units Interest Income Realized Gain Accretion Amortization Misc Net Income Interest Received Identifier Maturity Realized Loss Income Expense Income Interest Due AMERICAN HONDA FINANCE CORP 06/16/20 0.00 $1,531.25 $0.00 $36.55 $0.00 $0.00 $1,567.80 $18,375.00 02665WCH2 $0.00 $0.00 APPLE INC 05/1 1/22 2,500,000.00 4,791.67 0.00 0.00 (897.22) 0.00 3,894.45 0.00 037833CQ I 0.00 0.00 APPLE INC 05/1 1/23 915,000.00 571.88 0.00 66.92 0.00 0.00 638.80 0.00 037833DV9 0.00 0.00 CATERPILLAR FINANCIAL SERVICES CORP II/12/21 770,000.00 407.22 0.00 0.00 0.00 0.00 407.22 0.00 149I 3Q3D9 - 0.00 0.00 CHEVRON CORP 05/16/21 1,500,000.00 2,625.00 0.00 1,400.38 - 0.00 0.00 4,025.38 0.00 I66764BG4 0.00 0.00 CHEVRON CORP 03/03/22 2,000,000.00 4,163.33 0.00 0.00 (977.79) 0.00 3,185.54 0.00 166764BN9 0.00 0.00 CISCO SYSTEMS INC 02/28/21 1,350,000.00 2,475.00 0.00 0.00 (1,799.03) 0.00 675.97 0.00 17275RBD3 0.00 0.00 EXXON MOBIL CORP 08/16/22 800,000.00 1,268.00 0.00 0.00 0.00 0.00 1,268.00 0.00 30231 GBB7 0.00 0.00 FEDERAL HOME LOAN BANKS 02/17/23 4.000,000.00 4,583.33 0.00 0.00 (3,206.04) 0.00 1,377.29 0.00 3 130AJ7E3 0.00 0.00 FEDERAL HOME LOAN BANKS 06/03/22 6.000,000.00 625.00 0.00 38.68 0.00 0.00 663.68 0.00 3 130AJPU7 0.00 0.00 FEDERAL HOME LOAN BANKS ,03/1 1/22 2,000,000.00 3,750.00 0.00 0.00 (2,041.69) 0.00 I,7-08.31 0.00 313378CR0 0.00 . 0.00 FEDERAL HOME LOAN BANKS 06/10/22 1,800,000.00 3,187.50 0.00 0.00 (2,744.06) 0.00 443.44 1.9,125.00 3 13379Q69 0.00 0.00 FEDERAL HOME LOAN BANKS 09/09/22 1,750,000.00 2,916.67 - 0.00 - 0.00 (584.34) 0.00 2,332.32 0.00 313380GJ0 0.00 0.00 FEDERAL HOME LOAN BANKS 12/09/22 2,200,000.00 3,437.50 0.00 0.00 (2,066.16) 0.00 1,371.34 20,625.00 313381 BR5 0.00 0.00 FEDERAL HOME LOAN BANKS 12/09/22 5,000,000.00 2,083.34 0.00 0.00 (1,725.37) 0.00 357.96 0.00 31338 I BR5 . 0.00 0.00 FEDERAL HOME LOAN BANKS 03/10/23 2,000,000.00 3,541.67 0.00 0.00 (1,058.86) 0.00 2,482.80 0.00 313382AX I 0.00 0.00 FEDERAL HOME LOAN BANKS 06/12/20 0.00 1,417.01 0.00 0.00 (1-38.26) 0.00 1,278.76 23.187.50 313383HU8 0.00 0.00 FEDERAL FARM CREDIT BANKS FUNDING CORP 11/01/22 1,400,000.00 2,426.67 0.00 0.00 (1,843.28) 0.00 583.38 0.00 3I33EHM9I 0.00 0.00 FEDERAL FARM CREDIT BANKS FUNDING CORP 03/08/23 2,500,000.00 5,520.83 ' 0.00 0.00 (4.334.83) 0.00 1,186.00 0.00 3133EJFK0 0.00 0.00 Sample Client Portfolio LT 1-3 Public Trust Advisors r5 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Income 06/0 I/2020 to 06/30/2020 Description Final Current Units Interest Income Realized Gain Accretion Amortization Misc Net Income Interest Received Identifier Maturity Realized Loss Income Expense Income Interest Due FEDERAL FARM CREDIT BANKS FUNDING CORP 04/21/22 3,000,000.00 3,950.00 0.00 0.00 (3,045.51) 0.00 904.49 0.00 3133ELJC9 0.00 0.00 FEDERAL FARM CREDIT BANKS FUNDING CORP 02/21/23 . 2,000,00.0.00 2,416.67 0.00 0.00 (4.86) 0.00 2,41 1.81 0.00 3133ELNWO 0.00 0.00 FEDERAL FARM CREDIT BANKS FUNDING CORP 04/08/22 3,000,000.00 937.50 0.00 181.36 0.00 0.00 1,118.86 0.00 3 I33ELWD2 0.00 0.00 FEDERAL HOME LOAN MORTGAGE CORP 06/08/22 2,750,000.00 362.85 0.00 17.19 0.00 0.00 380.04 . 0.00 3134GVJ66 0.00 0.00 FEDERAL NATIONAL MORTGAGE ASSOCIATION 05/22/23 1,000,000.00 194.44 0.00 50.84 0.00 0.00 245.28 0.00 3 135G04Q3 0.00 0.00 FEDERAL NATIONAL MORTGAGE ASSOCIATION • 04/13/21 4,000,000:00 8,333.33 0.00 1,021.12 0.00 0.00 9,354.45. 0.00 3135G0U27 0.00 0.00 FHMS K-013 A2 01/25/21 749,368.39 2,481.66 0.00 0.00 (638.19) 0.00 1,839.63 2,483.75 3 137AA4W0 (3.84) 0.00 FHMS K-026A2 11/25/22 • 1,000,000.00 2,091.67 0.00 (50.89) 0.00 0.00 2,040.78 2,091.67 3137B I BSO 0.00 - 0.00 FHMS K-030A1 09/25/22 233,651.04 541.10 36.94 21.57 0.00 0.00 599.60 560.72 3137B3N95 0.00 0.00 FEDERAL HOME LOAN MORTGAGE CORP 01/13/22 650,000.00 1,286.46 0.00 - 0.00 (376.29) 0.00 910.17 0.00 • 3137EADB2 0.00 0.00 FEDERAL HOME LOAN MORTGAGE CORP II/17/20 6,500,000.00 10,156.25 0.00 712.58 0.00 0.00 10,868.83 0.00 3137EAEK 1 0.00 0.00 FEDERAL HOME LOAN MORTGAGE CORP 04/20/23 3,500,000.00 •1,093.75 0.00 161.97 - 0.00 0.00 1,255.72 0.06 3I37EAEQ8 0.00 - 0.00 FEDERAL HOME LOAN MORTGAGE CORP 06/26/23 3,645,000.00 126.56 0.00 48.26 0.00 0.00 174.82 0.00 3 137EAES4 0.00 0.00 FN AB5396 06/01/22 184,067.96 460.17 . 0.00 0.00 (144.96) 0.00 144.19 491.94 3141713710 (171.02) 0.06 • FIRST AMER:TRS OBG Y 06/30/20 557,496.43 2.29 0.00 0.00 0.00 0.00 2.29 2.20 31846V807 (0.00) 2.29 JOHNSON&JOHNSON 11/10/20 360,000.00 585.00 0.00 10.88 0.00 0.00 595.88 0.00 478160CH5 - 0.00 0.00 MICROSOFT CORP 02/06/22 1,000,000.00 2,000.00 0.00 0.00 (658.02) 0.00 1,341.98 0.00 594918BW3 0.00 0.00 PFIZER INC 12/15/21 - 1,000,000.00 1,833.33 0.00 0.00 (305.52) 0.00 1,527.81 11,000.06 717081 DZ3 0.00 0.00 TOYOTA MOTOR CREDIT CORP 04/13/21 1,650,000.00 4,056.25 0.00 18.43 0.00 0.00 4,074.68 0.00 89236TEU5 0.00 0.00 Sample Client Portfolio LT 1-3 Public Trust Advisors 8 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 in co rn e 06/0 I/2020 to 06/30/2020 Description Final Current Units Interest Income Realized Gain Accretion Amortization Misc Net Income Interest Received Identifier Maturity Realized Loss Income Expense Income Interest Due U.S.BANCORP 03/15/22 I,250,000.00 3,125.00 0.00 0.00 (1,017.87) 0.00 2,107.13 0.00 91 I59HHC7 0.00 0.00 UNITED STATES TREASURY 08/31/22 3,000,000.00 3,974.18 0.00 0.00 (71.50) 0.00 3,902.69 0.00 912828258 0.00 0.00 UNITED STATES TREASURY 09/15/20 1,500,000.00 1,681.39 0.00 . 185.63 0.00 0.00 1,867.01 0.00 9128282V I ' ' 0.00 0.00 UNITED STATES TREASURY 01/31/23 1,350,000.00 2,642.51 0.00 0.00 (748.14) 0.00 1,894.38 0.00 9128283U2 0.00 0.00 UNITED STATES TREASURY 02/15/21 3,400,000.00 6.304.94 0.00 718.92 0.00 0.00 7,023.86 0.00 9128283X6 0.00 0.00 UNITED STATES TREASURY 03/15/21 3,825,000.00 7,405.74 0.00 349.48 0.00 0.00 7,755.22 0.00 9128284B3 0.00 0.00 • UNITED STATES TREASURY 04/15/21 5,000,000.00 9,733.61 0.00 599.90 0.00 0.00 10,333.51 0.00 9128284G2 0.00 0.00 UNITED STATES TREASURY II/15/21 4,700,000.00 11,015.62 0.00 0.00 (649.71) 0.00 10,365.91 0.00 9 128285 L0 0.00 0.00 UNITED STATES TREASURY 1 1/30/20 725,000.00 1,188.52 0.00 0.00 (7.45) 0.00 1,181.07 7,250.00 912828A42 • 0.00 0.00 UNITED STATES TREASURY 09/30/21 4,800,000.00 8,360.66 0.00 2,124.19 0.00 0.00 10,484.85 0.00 912828F21 0.00 0.00 UNITED STATES TREASURY 10/31/21 1,375,000.00 2,241.85 0.00 0.00 (442.06) 0.00 1,799.78 0.00 912828F96 0.00 0.00 UNITED STATES TREASURY 03/31/22 2,000,000.00 2,868.85 0.00 0.00 (229.73) 0.00 2,639.13 0.00 912828J76 0.00 0.00 UNITED STATES TREASURY II/15/20 4,000,000.00 8,559.78 0.00 343.94 0.00 0.00 8,903.72 0.00 912828PC8 - 0.00 0.00 UNITED STATES TREASURY 08/15/21 7,375,000.00 12,916.38 0.00 4,496.54 0.00 0.00 17,412.92 0.00 9 12828RC6 0.00 0.00 UNITED STATES TREASURY ,05/15/22 2,000,000.00 2,853.26 0.00 0.00 (224.41) 0.00 2,628.85 0.00 9 128285V3 0.00 0.00 UNITED STATES TREASURY 08/15/22 I,100,000.00 1,473.21 0.00 0.00 (61.26) 0.00 1,411.95 0.00 9 12828TJ9 0.00 0.00 UNITED STATES TREASURY 0.9/30/20 2,475,000.00 4,057.38 0.00 0.00 (167.83) 0.00 3,889.55 0.00 912828VZ0 0.00 0.00 UNITED STATES TREASURY 10/31/20 1,000,000.00 1,426.63 0.00 0.00 (128.36) 0.00 1,298.27 0.00 9 12828WC0 0.00 0.00 UNITED STATES TREASURY 05/3 I/22 1,575,000.00 2,420.60 0.00 0.00 (310.42) 0.00 2,110.18 14,765.63. 9 12828XD7 0.00 0.00 Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Income 06/01/2020 to 06/30/2020 Description Final Current Units Interest Income Realized Gain Accretion Amortization Misc Net Income Interest Received Identifier Maturity Realized Loss Income Expense Income Interest Due UNITED STATES TREASURY 05/31/20 0.00 0.00 0.00 0.00 0.00 0.00 0.00 5,625.00 912828XE5 0.00 0.00 UNITED STATES TREASURY 06/30/22 I,000,000.00 1,750.74 0.00 0.00 (414.35) 0.00 1,336.39 10,625.00. 912828XG0 0.00 0.00 UNITED STATES TREASURY 06/30/20 0.00 4,464.29 592.02 0.00 (206.15) 0.00 4,850.16 0.00 912828XH8 0.00 0.00 UNITED STATES TREASURY 06/15/20 0.00 2.868.85 0.00 129.95 0.00 0.00 2,998.80 37,500.00 912828XU9 0.00 0.00 UNITED STATES TREASURY 07/15/21 7,275,000.00 15,739.18 0.00 1,556.44 0.00 0.00 17,295.63 0.00 9 12828Y20 0.00 0.00 UNITED STATES TREASURY 08/15/22 1,000,000.00 1,236.26 0.00 83.19 0.00 0.00 1,319.45 0.06 9 12828YA2 0.00 0.00 WALMART INC 06/23/20 0.00 8,534.17 0.00 47.21 0.00 0.00 8,581.38 69,825.00 93 1142EG4 0.00 0.00 Receivable 06./30/20 2,29 0.00 0.00 0.00 0.00 0.00 0.00 0.00 CCYUSD 0.00 0.00 ( $628.95 $243 533.411 portfolio Total 01/18/22 136,989,586.1 I $223,075.76 $14,371.23 ($33,269.54) $0.00 $204,631.54 i , ($174.86) $2.29• Sample Client Portfolio LT I-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 . GASB 40 06/0 I/2.020 to 06/30/2020 Issuer Security Type Book Yield Duration S&P Effective Maturity Current Units Accrued Book Value Market Value Identifier %of Market Value Market Yield Moody's Final Maturity Book Value+Accrued Market Value+ Accrued Apple Inc. Apple Inc. CORP 1.84% AA+ 04/I I/22 $2,519,864.71 $2,588,509.55 037833CQ I 1.85% 0.30% 1.06 Aa I 05/1 1/22 2.500,000.00 $7,986.I I $2,527,850.82 $2,596,495.66 Apple Inc. CORP 0.84% AA+ 05/11/23 912,624.97 924,639.70 037833DV9 0.66% 0.38% 2.83 Aal 05/11/23 915,000.00 953.12 913,578.09 925,592.82 A le Inc. 1.58% AA+ $3,432,489.67 $3,513,149.25 Pp 1,52 3,415 000.00 $8,939.24 2.51% 0.32% Aal $3,441,428.91 $3,522,088.48 Caterpillar Financial Services Corporation . Caterpillar Financial Services CORP 0.64% A II/12/21 $770,000.00 $769,761.30 Corporation 0.55% 0.67% 0.12 $678.70 A3 1 1/12/21 770,000.00 $770,678.70 $770,440.00 14913Q3D9 Caterpillar Financial Services 0.64% A $770,000.00 $769,761.30 Corporation 0.55% 0.67% 0.12 A3 770,000.00 $678.70 $770,678.70 $770,440.06 - i Chevron Corporation Chevron Corporation CORP 3.28% AA 04/16/21 $1,484.828.22 $1,520,614.47 166764BG4 1.08% 0.37% 0.48 Aa2 05/16/21 I,500,000.00 $3,937.50 $1,488,765.72 $1,524,551.97 Chevron Corporation CORP 1.88% AA 02/03/22 2,019,401.31 2,069,405.74 166764BN9 1.48% 0.31% 0.95 Aa2 03/03/22 2,000,000.00 16,375.78 2,035.777.09 2,085,781.52 Chevron Corporation 2.47% AA $3,504,229.53 $3,590,020.211 0.75 3,500,000.00 $20 313.28 t . 2.57% 0.33% Aa2 $3,524,542.80 $3,610,333.491 Cisco Systems,Inc. Cisco Systems,Inc. CORP 0.56% AA- 02/28/2I $1,364,496.34 $1,366,473.48 I7275RBD3 0.98% 0.35% 0.65 Al 02/28/21 1.350,000.00 $10,147.50 $1,374,643.84 $1,376,620.98 Cisco Systems,Inc. - 0.56% AA- $1,364,496.34 $1,366,473.48 0,65 1,350,000.00 $10147.50 0.98% 0.35% Al $1,374,643.84 $1,376,620.98 Exxon Mobil Corporation Exxon Mobil Corporation CORP 1.90% AA 08/16/22 $800,000.00 $824,935.19 3023 I GBB7 0.59% 0.43% 2,08 Aa I 08/16/22 800,000.00 $5,706.00 $805,706.00 $830,641.19 Exxon Mobil Corporation 1.90% AA $800,000.00 $824,935.19 2.08 800,000.00 $5,706.00 I 0.59% 0.43% Aal $805,706.00 $830,641.I9 FHLMC • Sample Client Portfolio LT 1-3 Public Trust Advisors i9 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 G AS B 40 06/0 I/2020 to 06/30/2020 Issuer Security Type Book Yield Duration S&P Effective Maturity Current Units Accrued Book Value Market Value Identifier %of Market Value Market Yield Moody's Final Maturity Book Value+Accrued Market Value+ Accrued FHLMC GSE 0.35% AA+ 06/26/23 $3,634,404.86 $3,639,326.56 3137EAES4 2.59% 0.30% 2.98 Aaa 06/26/23 3,645,000.00 $126.56 $3,634,531.42 $3,639,453.12 FHLMC $3,634,404.86 -- ^y 2.59% _ , 0.30% 2.98 Aaa -�1 3,645,000.00 $126.56 $3,634,531.42 - $3,639,326.56 3,639, . 2 - - Federal Farm Credit Banks Funding Corporation Federal Farm Credit Banks GSE 0.45% AA+ 04/08/22 $2,996,067.79 $3,008,063.91 Funding Corporation $2,593.75 2.14% 0.22% I.76 Aaa 04/08/22 3,000,000.00 $2,998,661.54 $3,010,657.66 3133ELWD2 Federal Farm Credit Banks GSE 0.33% AA+ 04/21/22 - 3,067,293.8.1 3,072,051.39 Funding Corporation 2.19% 0.25% 1.78 Aaa - 04/21/22 3,000,000.00 9,216.67 3,076.510.47 3,081,268.06 3133ELJC9 Federal Farm Credit Banks GSE 0.45% AA+ 11/01/22 1,453.032.46 1.459,894.49 Funding Corporation 4,853.33 1.04% 0.24% 2.28 Aaa 11/01/22 1,400,000.00 1,457,885.79 1,464,747.83 3133EHM9I Federal Farm Credit BanksGSE 1.45% AA+ 02/,21/23 2,000,158.79 2,060,718.72 Funding Corporation 1.47% 0.30% 2.59 Aaa 02/21/23 2,000,000.00 10,472.22 2,010,631.02 - 2,071,190.94 3133ELNW0 Federal Farm Credit BanksGSE 0.48% AA+ 03/08/23 2,644,306.52 2.657,307.12 Funding Corporation 14 1.90% 0.30% 2.59 Aaa 03/08/23 2,500,000.00 20,795. 2,665,101.66 2,678,102.26 3133EJFK0 Federal Farm Credit Banks - 0.59% AA+ $12,160,859.37 $12,258,035.64 Funding Corporation 8.75% 0,26% 2.15 Aaa 11,900,000.00 $47,931.1 1 . $12,208,790.48 $12,305,966.75 Federal Home Loan Banks • Federal Home Loan Banks GSE 0.97% AA+ 03/1 1/22 $2,042,833.97 $2,066,119.02 313378CR0 1.48% 0.30% 1.66 Aaa 03/1 1/22 2,000,000.00 $13,750.00 $2,056,583.97 $2,079,869.02 Federal Home Loan Banks GSE 0.27% AA+ 06/03/22 - 5,998,178.68 6,002,022.36 3130AJPU7 4.27% 0.23% 1.92 Aaa 06/03/22 6,000,000.00 791.67 5,998,970.35 6,002,814.03 Federal Home Loan Banks GSE 0.24% AA+ 06/10/22 1,865.543.89 1,864,671.17 313379Q69 1.33% 0.27% 1.91 Aaa 06/10/22 1,800,000.00 2.231.25 1,867,775.14 1,866,902.42 Federal Home Loan Banks GSE 1.57% AA+ 09/09/22 1,765,983.66 1,817,717.90 313380GJ0 1.30% 0.23% ?'14 75000000 1088889 Aaa 09/09/22 1, , . , . 1,776,872.55 1,828,606.78 Federal Home Loan Banks GSE 0.71% AA+ 12/09/22 2,262,094.63 2,285,245.64 313381BR5 1.63% 0.28% 2.39 Aaa 12/09/22 2,200,000.00 2,520.83 2,264,615.46 2,287,766.48 Federal Home Loan Banks GSE 0.28% AA+ 12/09/22 5,193,374.63 5,193,740.10 31338I BR5 3.70% 0.28% 2'39 Aaa 12/09/22 5,000,000.00 5,729.17 5,1 99,103.79 5,199,469.27 Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C3161A2C0 GASB 40 06/01/2020 to 06/30/2020 Issuer Security Type Book Yield Duration S&P Effective Maturity Current Units Accrued Book Value Market Value Identifier %of Market Value Market Yield Moody's Final Maturity Book Value+Accrued Market Value+ Accrued Federal Home Loan Banks GSE 0.38% AA+ 02/17/23 4,103,466.10 4,1 17,676.68 3 130AJ7E3 2.94% 0.25% 2.58 Aaa 02/17/23 4,000,000.00 19,861.1 I 4.123,327.21 4,137,537.79 Federal Home Loan Banks GSE 1.45% -AA+ 03/10/23 2,035,689.30 2,096,925.40 313382AX 1 -1.50% 0.32% 2'61 Aaa 03/10/23 2,000,000.00 13,104.17 2,048,793.46 2,1 10,029.57 Federal Home Loan Banks 0.57% AA+ $25,267,164.87 I8.15% 0.26% 2.22 24,750,000.00 $68,877.08 $25,444,IIS.27 Aaa $25,336,041.95 $25,5I2,995.36 Federal National Mortgage - Association . • Federal National MortgageGSE 2.82% AA+ 04/13/21 $3,990,143.46 $4,073,082.28 Association 2.91% 0.17% 0.78 Aaa 04/13/21 4,000,000.00 $21,666.67 $4,011,810.12 $4,094,748.95 3135G0U27 Federal National Mortgage GSE MBS 1. Association 0.2334% �+ 05/06/21 184,067.96 460.17 186,400.11 193,39830 3141767J0 0.14% (3.15%) Aaa 06/01/22 186,860.28 193,858.47 Federal National Mortgage GSE 0.32% AA+ 05/22/23 998,067.84 998,949.84 Association270.83 0.71% 0.29% 2.88 Aaa 05/22/23 I.000,000.00 998,338.67 999,220.67 3 135G04Q3 Federal National Mortgage - 2.29% $5,174,611.41 $5,265,430.42 + Association 3.76% 0.07% 1.16 Aaa 5,184,067.96 $22,397.67 $5,197,009.08 $5,287,828.09' First American Funds,Inc.- - Treasury Obligations Fund • First American Funds,Inc. MMFUND 0.01% AAAm 06/30/20 $557,496.43 $557,496.43 Treasury Obligations Fund $0.00 0.40% 0.01% 0.00 Aaa 06/30/20 557,496.43 $557,496.43 $557,496.43 3I846V807 First American Funds,Inc.- 0.01% AAAm $557,496.43 $557,496.43, Treasury Obligations Fund 0,00 • 557,496.43 $0.00 r 0.40% 0.01% Aaa $557,496.43 $557,496.41 Freddie Mac Freddie Mac GSE 2.01% AA+ 11/17/20 $6,496,698.40 $6,541,813.85 3137EAEKI 4.66% 0.18% 0.38 Aaa 11/17/20 6,500,000.00 $14,895.83 $6,511,594.24 $6,556,709.68 Freddie Mac GSE MBS 2.38% AA+ 12/29/20 753,282.60 757,404.99 3137AA4W0 0.54% 1.27%' 0'49 Aaa 01/25/21 749,368.39 2,481.66 755,764.26 759,886.65 Freddie Mac GSE 1.65% AA+ 01/13/22 657,1 12.60 671,669.I 3137EADB2 0.48% 0.20% 1.50 Aaa 01/13/22 650,000.00 7.204.17 664,316.77 678,873.26 - Freddie Mac GSE 0.26% AA+ 06/08/22 2,749,357.19 2,747,268.29 3134GVJ66 1.95% 0.30% 1.93 2 Aaa 06/08/22 ,750,000.00 439.24 2,749,796.43 2,747,707.52 Sample Client Portfolio LT 1-3 Public Trust Advisor's zi DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 GASB 40 06/01/2020to06/30/2020 Issuer Security Type Book Yield 'Duration S&P Effective Maturity Current Units Accrued Book Value Market Value Identifier %of Market Value Market Yield Moody's Final Maturity Book Value+Accrued Market Value+ Accrued Freddie Mac GSE MBS 3.01% AA+ 08/08/21 232,653.93 239,138.50 3137B3N95 0.17% 0.49% I.10 Aaa 09/25/22 233,651.04 541.10 233,195.02 239,679.60 Freddie Mac GSE MBS 2.46% AA+ 10/15/22 999,767.94 1,040,015.20 31373IBS0 0.74% 0.68% 2.22 Aaa 11/25/22 1,000,000.00 2,091.67 1,001,859.61 1,042,106.87 Freddie Mac GSE 0.43% AA+ 04/20/23 3,494,427.94 3,509,549.50 3 137EAEQB 2.50% 0.28% 2.79 Aaa 04/20/23 3,500,000.00 2,588.54 3,497,0 I 6.48 3,512,138.05 . • Freddie Mac 1.39%__. AA+ $15,383,300.60 $15,506 859.42 11.05% 0.32% . .1.39 Aaa 15,383,019.43 $30,242.20 $l 5,413,542.80 $15,537,101.62 Johnson&Johnson Johnson&Johnson CORP 1.99% AAA II/10/20 $359,952.15 $362,216.71 478160CH5 0.26% 0.24% 0.36 Aaa 1 1/10/20 360,000.00 $9.94.50 $360,946.65 $363,211.21 Johnson&Johnson 1.99% AAA $359,952.15 $362,216.71 0.36 360,000.00 $994.50 0.26% 0.24% Aaa $360,946.65, • $363,211.2� Microsoft Corporation . Microsoft Corporation CORP 1.58% AAA 01/06/22 $1,012,279.76 $1,031,909.66 594918BW3 0.74% 0.29% 0.90 Aaa 02/06/22 I,000,000.00 $9,666.67 $1,021,946.42 $1,041,576.33 Microsoft Corporation 1.58% - - AAA $1,012,279.76 - $1,031,909.66: 0.90 1,000,000.00 $9,666.67 i 0.74% 0.29% Aaa $1,021,946.42 $1,041,576.33r Pfizer Inc. Pfizer Inc. CORP 1.81% AA- 12/15/21 $1,005,504.15 $1,024,768.37 717081DZ3 0.73% 0.49% 1.44 Al 12/15/21 I,000,000.00 $977.78 $1,006,481.92 $1,025,746.15 Pfizer Inc. 1.81% AA-L $I 005 504.15 $I 024 768.37 1.44 AlI,000,000.00 $977.78 • r 0.73% 0.49% $1,006,481.92 $1,025,746.15 Toyota Motor Credit Corporation Toyota Motor Credit CORP 2.96% A+ 04/13/21 $1,649,822.03 $1,681,937.81 Corporation 1.20% 0.48% 0.78 Al 04/13/21 1,650,000.00 $10,546.25 $1,660,368.28 $1,692,484.06 89236TEU5 Toyota Motor Credit -___-._-_.-- ___-- -----_o- ------ -- --- - - - - - -2.96/ A+ $1,649 822.03 $1,681,937.811 Corporation 0,78 1,650,000.00 $10,546.25 I 1.20% 0.48% Al $1,660,368.28 $1,692,484.0 U.S.Bancorp U.S.Bancorp CORP 1.96% A+ 02/15/22 $1,270,614.38 $1,304,260.32 91I59HHC7 0.94% 0.32% 0.96 Al 03/15/22 1,250,000.00 $11,041.67 $1,281,656.05 $1,315,301.99 Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 GASB 40 06/01/2020 to 06/30/2020 Issuer Security Type Book Yield Duration S&P Effective Maturity Current Units Accrued Book Value Market Value Identifier %of Market Value Market Yield Moody's Final Maturity Book Value+Accrued Market Value+ Accrued U.S.Bancorp 1.96% 0.96 A+ 1,250 000.00 $11,041.67 $1,270,614.38 $1,304,260.32 0.94% 0.32% Al $1,281,656.05 $1,3.15,301.99 United States Department of The Treasury United States Department of US GOV 1.53% AA+ 09/15/20 $1.499,529.74 $1,503,699.00 The Treasury 1.07% 0.20% 0.21 Aaa 09/15/20 1,500,000.00 $6,052.99 $1,505,582.73 $1,509,751.99 9128282V1 United States Department of US GOV 1.92% AA+ 09/30/20 2.475,509.08 2,486,189.48 The Treasury 0.25 2,475,000.00 12,442.62 912828VZ0 1.78% 0.20% Aaa 09/30/20 2,487,951.71 2,498,632.10 • United States Department of US GOV 1.59% AA+ 10/31/20 1,000,522.01 1,005.I 67.00 The Treasury 0.72% 0.20% 0.33 Aaa 10/31/20 I,000,000.00 2,948.37 1,003,470.38 1,008,115.37 9 12828WC0 United States Department of US GOV 2.73% AA+ 1 1/15/20 3,998,429.36 4,035,936.00 The Treasury 0.37 4,000,000.00 13,410.33 2.88% 0.23% 912828PC8Aaa 1.1/15/20 4,011,839.68 4,049,346.33, United States Department of US GOV 1.99% AA+ 1 1/30/20 725,037.76 730,324.40 The Treasury 0.42 725,000.00 1,228.14 0.52% 0.24% 912828A42 Aaa 11/30/20 726,265.9I 731,552.54 United States Department of US GOV • 2. The Treasury 0,6251 AA+ 02/I5/21 3,400,000.00 28,792.58 3,394,505.41 3,443,829.40 9128283X6 2.47% 0.19% Aaa 02/15/21 3,423,297.99 3,472,621.98 United States Department of US GOV 2.49% AA+ 03/15/21 3,821,944.47 3,884,019.75 The Treasury 2.78% 0 20% 0.70 3,825,000.00 26,660.67 912828483Aaa 03/15/21 3,848,605.13 3,9I0,680.42 • United States Department of US GOV 2.53% AA+ 04/15/21 4,994,174.74 5,086,330.00 The Treasury 0.79 5,000,000.00 24,982,92 3.64% 0.19% 9128284G2 " Aaa 04/15/21 5,019,157.67 5,1 1 1,312.92 United States Department of US GOV 2.90% AA+ 07/15/21 7,254,976.66 7,459,435.80 The Treasury 88,139.42 5.37% 0.19% 1.02 Aaa 07/15/21 7,275,000.00 7,343,1 16.08 7,547,575.22 9I2828Y20 United States Department of US GOV 2.90% AA+ 08/15/21 7,312,505.85 7,535,177.62 The Treasury 5.40% 0.19% 1.1 1 58,984.80 Aaa 08/15/21 7,375,000.00 7,371,490.65 7,594,162.43 9I2828RC6 United States Department of US GOV 2.69% AA+ 09/30/21 4,767,1 16.87 4,916,251.20 The Treasury 1.23 4,800,000.00 25,639.34 3.52% 0.19% 912828F21 Aaa 09/30/21 4,792,756.22 4,941,890.54 United States Department of US GOV 1.60% AA+ 10/31/21 1,382,285.45 1,408,515.62 The Treasury 1.01% 0.17% 1.32 Aaa 10/31/21 1,375,000.00 4,633.15 1,386,918.61 1,413,148.78 9I2828F96 Sample Client Portfolio LT 1-3 Public Trust Advisors zs DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 GASB 40 06/0 I/2020 to 06/30/2020 • • Issuer Security Type Book Yield Duration S&P Effective Maturity Current Units Accrued Book Value Market Value Identifier %of Market Value Market Yield Moody's Final Maturity Book Value+Accrued Market Value+ Accrued United States Department of US GOV 2.70% AA+ 1 1/15/21 4,71 1,098.84 4,873,495.80 The Treasury 3.48% 0.19% 13 17,257.81 5 Aaa II/15/21 4,700,000.00 4,728.356.65 4,890,753.61 9128285L0 United States Department of US GOV 1.61% AA+ 03/31/22 2,004,968.66 2,055,000.00 The Treasury 8,797.81 1.47% 0.18% 1.72 Aaa 03/31/22 2,000,000.00 2,013,766.47 2,063,797.81 9I2828J76 • United States Department of US GOV 1.61% AA+ 05/15/22 2,005,220.69 2,059,062.00 The Treasury1 I 1.47% 0.17% 1.85 Aaa 05/15/22 2,000,000.00 4.470. 2,009,690.80 2,063,532.1 I 912828SV3 United States Department of US GOV 1.63% AA+ 05/31/22 1,582,346.42 1,626,310.35 The Treasury 1.16% 0.17% 1.89 Aaa 05/31/22 1,575,000.00 2,501.28 1,584,847.70 1,628,811.63 912828XD7 United States Department of US GOV 1.60% AA+ 06/30/22 1,010,245.05 1,039,062.00 The Treasury I 0.74% 0.17% 1.97 Aaa 06/30/22 ,000,000.00 57.74 1,010,302.79 1,039,I 19.74 912828XG0 United States Department of US GOV 1.55% AA+ 08/15/22 1,101,607.62 1,133,944.90 The Treasury 0.81% 0.17% 2'09 Aaa 08/15/22 1,100,000.00 6,727.68 1,108,335.30 1,140,672.58 912828TJ9 United States Department of US GOV 1.61% AA+ 08/15/22 997,815.74 1,028,281.00 The TreasuryI 5,645.60 0.74% 0.17% 2.09 Aaa 08/15/22 ,000,000.00 1,003,461.34 1,033,926.60 912828YA2 United States Department of US GOV 1.59% AA+ 08/31/22 3,001,934.73 3,094,218.00 The Treasury 2 21% 0.17% 2'13 Aaa 08/31/22 3,000,000.00 16,294.16 3,018,228.88 3,1 10,512.16 912828258 United States Department of US GOV 1.67% AA+ 01/31/23 1,374,015.90 1,426,4 I 2.70 The Treasury 13,388.74 1.02% 0.18% 2.50 Aaa 01/31/23 1,350,000.00 1,387,404.63 1,439,801.44 9 128283U2 United States Department of 2.36% $60,415,791.05 $61,830,662.02 The Treasury 44.24% 0.19% 1.13 Aaa 60,475,000.00 $369,056.28 $60,784,847.33 $62,199,718.31 I Portfolio Total 1.65% AA+ 01/14/22 $137,763,016.58 $139,971,361.08 1.48 136,989,583.82 $617,642.49 _—--_ 100.00% 0.24% Aaa 01/18/22 $138,380,659.06 $140,589,003.56 Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Portfolio Activity Summary 06/01/2020to06/30/2020 Description Security Type Beginning Original Cost Purchases Sales Maturities Interest Received Realized Gain/Loss Ending Original Cost Identifier Final Maturity Beginning Market Value Ending Market Value Purchased Accrued Disposed Accrued Paydowns Transfers Unrealized Gain/Loss Beginning Book Value Ending Book Value Receivable CASH $777,642.82 $0.00 $0.00 $0.00 $0.00 $0.00 $2.29 CCYUSD 06/30/20 $777,642.82 $0.00 $0.00 $0.00 $0.00 $0.00 $2.29 $777,642.82 $2.29 313,658.49 557,496.43 FIRST AMER:TRS OBG Y MMFUND I5,170,025.22 (14,926,187.28) 0.00 2.20 (0.00) 3I846V807 06/30/20 313,658.49 0.00 0.00 0.00 0.00 0.00 557,496.43 313,658.49 557,496.43 AMERICAN HONDA CORP 1,223,346.25 0.00 0.00 (1,225,000.00) 18,375.00 0.00 0.00 FINANCE CORP 06/16/20 I,226,092.97 0.00 0.00 0.00 0.00 0.00 0.00 02665WCH2 1,226,092.97 0.00 • WALMART INC CORP 4,898,481.00 0.00 0.00 (4,900,000.00) 69,825.00 0.00 0:00 931142EG4 06/23/20 4,908,311.43 0.00 0.00 0.00 0.00 0.00 0.00 4,908,31 1.43 - 0.00 JOHNSON&JOHNSON CORP 359,614.80 0.00 0.00 0.00 0.00 0.00 359,614.80 478I60CH5 1 1/10/20 362,721.59 0.00 0.00 0.00 0.00 2,264.56 362,216.71 362,721.59 359,952.15 CISCO SYSTEMS INC CORP • 1,367,914.50 0.00 0.00 0.00 0.00 0.00 1,367,914.50 17275RBD3 02/28/21 1,367,838.83 0.00 0.00 0.00 0.00 1,977.15 1,366,473.48 1,367,838.83 1,364,496.34 TOYOTA MOTOR CREDIT 1,649,340.00 1,649,340.00 CORP 0.00 0.00 0.00 0.00 0.00 CORP 04/13/21 1,683,128.29 0.00 0.00 0.00 0.00 32,115.79 1,681,937.81 89236TEU5 1,683,128.29 1,649.822.03 CHEVRON CORP CORP 1,457,280.00. 0.00 0.00 0.00 0.00 0.00 1,457,280.00 I66764BG4 05/16/21 1,522,543.23 0.00 0.00 0.00 0.00 35,786.25 1,520,614.47, 1,522.543.23 1,484.828.22 CATERPILLAR FINANCIAL CORP 770,000.00 0.00 0.00 0.00 0.00 0.00 770,000.00 SERVICES CORP 765.490.43 769,761.30 149I3Q3D9 I I/12/21 765,490.43 0.00 0.00 0.00 0.00 (238.70) 770,000.00 PFIZER INC CORP 1,007,980.00 0.00 0.00 0.00 11,000.00 0.00 1,007,480.00 717081DZ3 12/15/21 1,032,351.53 0.00 0.00 0.00 0.00 19,264.22 1,024,768.37 1,032,351.53 I,005,504.15 MICROSOFT CORP CORP 1,015,460.18 0.00 0.00 0.00 0.00 0.00 1,015,460.18 5949I8BW3 02/06/22 1,034,157.00 0.00 0.00 0.00 0.00 19,629.90 1,031,909.66 1,034,157.00 I,0 12,279.76 CHEVRON CORP CORP 2,027,320.00 0.00 0.00 0.00 0.00 0.00 2,027,320.00 ,166764BN9 03/03/22 2,069,717.62 0.00 0.00 0.00 0.00 50,004.43 2,069,405.74 2,069,7 17.62 2,019,401.31 U.S.BANCORP CORP 1,279,387.50 0.00 0.00 0.00 0.00 0.00 1,279,387.50 91159HHC7 03/15/22 1,303,546.18 0.00 0.00 0.00 0.00 33,645.94 1,304,260.32 1,303,546.18 I.270,614.38 APPLE INC CORP 2,526,750.00 0.00 0.00 0.00 0.00 0.00 2.526,750.00 037833CQ 1 05/1 1/22 2,594,731.70 0.00 0.00 0.00 0.00 68,644,84 2,588,509.55 2,594,73 1.70 2,519,864.71 • Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Portfolio Activity Summary 06/01/2020to06/30/2020 Beginning Original Cost Purchases Sales Maturities Interest Received Realized Gain/Loss Ending Original Cost Description Security Type Beginning Market Value Purchased Accrued Disposed Accrued Paydowns Transfers Unrealized Gain/Loss Ending Market Value Identifier Final Maturity Beginning Book Value Ending Book Value EXXON MOBIL CORP CORP 800,000.00 0.00 0.00 0.00 0.00 0.00 800,000.00 30231GBB7 08/16/22 825,013.50 0.00 0.00 0.00 0.00 24,935.19 824,935.19 825,013.50 800,000.00 • 912,511.20 912.511.20 APPLE INC CORP 0.00 0.00 0.00 0.00 0.00 037833DV9 05/1 1/23 923,427.08 0.00 0.00 0.00 0.00 12,014.73 924;639.70 923,427.08 912,624.97 FEDERAL HOME LOAN 2,663,356.00 0.00 GSE 0.00 0.00 (2,650,000.00) 23,187.50 0.00 BANKS 06/12/20 2,651,319.62 0.00 0.00 0.00 0.00 0.00 0.00 313383 HU8 2,651,319.62 0.00 FEDERAL HOME LOAN 6,474,845.00 . 6,474,845.00 GSE 0.00 0.00 0.00 0.00 0.00 MORTGAGE CORP 6,550,084.71 6,541,813.85 3 137EAEK I I 1/17/20 6,550,084.71 0.00 0.00 0.00 0.00 45,1 15.45 6,496,698.40 FEDERAL NATIONAL 3,966,800.00 3,966,800.00 GSE 0.00 0.00 0.00 0.00 0.00 MORTGAGE ASSOCIATION 04/13/21 4,079,790.32 0.00 0.00 0.00 0.00 82,938.82 4,073,082.28 3135G0U27 4,079,790.32 3,990,143.46 FEDERAL HOME LOAN 659,932.00 659,932.00 GSE 0.00 0.00 . 0.00 0.00 0.00 MORTGAGE CORP 01/13/22 672,856.67 0.00. 0.00 0.00 0.00 14,556.49 671,669.10 3 I37EADB2 672;856.67 657,1 12.60 FEDERAL HOME LOAN 2,050,940.00 2,050,940.00 GSE 0.00 0.00 0.00 0.00 0.00 BANKS 03/11/22 2,07 I,062.50 0.00 0.00 0.00 0.00 23,285.05 2,066,I 19.02 03/11/22 0.00 0.00 0.00 0.00 23,285.05 313378CR0 2,071,062.50 2,042,833.97 FEDERAL FARM CREDIT GSE 2,995,560.00 0.00 0.00 0.00 0.00 • 0.00 2,995,560.00 BANKS FUNDING CORP 04/08/22 3,007,256.13 . 0.00 0.00 0.00 0.00 11,996.F2 3,008,063.91• 3133ELWD2 3,007,256.13 2,996.067.79 FEDERAL FARM CREDIT 3,074.400.00 3,074.400.00 GSE 0.00 0.00 0.00 0.00 0.00 BANKS FUNDING CORP 04/21/22 3,074,804.01 0.00 0.00 0.00 0.00 4,757.58 3,072,051.39 3133ELJC9 3,074,804.01 3,067,293.81 FEDERAL HOME LOAN 0.00 5,998.140.00 GSE 5,998,140.00 0.00 0.00 0.00 0.00 BANKS 06/03/22 0.00 (166.67) 0.00 0.00 0.00 3,843.68 6,002,022.36 3I30AJPU7 0.00 5,998,178.68. FEDERAL HOME LOAN 0.00 2,749,340.00 MORTGAGE CORP GSE 0.00 2,749,340.00 0.00 0.00 0.00 0.00 2,747,268.29 3134GVJ66 06/08/22 0.00 (76.39) 0.00 0.00 0.00 (2,088.90) 2,749,357.19 FEDERAL HOME LOAN 1,870,092.00 • 1,870,092.00 GSE 0.00 0.00 0.00 19,125.00 0.00 BANKS 1,868,196.04 1,864,671.17, 313379Q69 06/10/22 1,868,196.04 0.00 0.00 0.00 0.00 (872.72) 1.865,543.89, FEDERAL HOME LOAN 1,771,700.00 1,771,700.00 GSE 0.00 0.00 0.00 0.00 0.00 BANKS 1,818,268.36 1,817,717.90 313380GJ0 09/09/22 1,818,268.36 0.00 0.00 0.00 0.00 51,734.23 1,765,983.66 FEDERAL FARM CREDIT 1,458,660.00 1,458,660:00 GSE 0.00 0.00 0.00 0.0,0 0.00 BANKS FUNDING CORP I I/01/22 1,461,492.26 0.00 0.00 0.00 0.00 6,862.04 1,459,894.49 3133EHM9 I 1,461,492.261,453,032.46 Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Portfolio Activity Summary 06/01/2.020to06/30/2020 Description Security Type Beginning Original Cost Purchases Sales Maturities Interest Received Realized Gain/Loss Ending Original Cost Beginning Market Value Ending Market Value Purchased Accrued Disposed Accrued Paydowns Transfers Unrealized Gain/Loss Identifier Final Maturity Beginning Book Value Ending Book Value FEDERAL HOME LOAN 2,270,1 14.00 2,270.1 14.00 GSE 0.00 0.00 0.00 20,625.00 0.00 2,287,917.74 0.00 0.00 0.00 0.00 23,151.01 2,285,245.64 BANKS 12/09/22 313381 BR5 2,287,917.74 2,262,094.63 • FEDERAL HOME LOAN 0.00 5,195,100.00 GSE 5,195,100.00 • 0.00 0.00 0.00 0:00 BANKS 0.00 5,193,740.10 313381 BR5 12/09/22 0.00 (3,645.83) 0.00 0.00 0.00 365.47 5,193,374.63 FEDERAL HOME LOAN GSE 4,1 10,840.00 0.00 0.00 0.00 0.00 0.00 4,1 10,840.00 BANKS 4,119,928.20 4,117,676.68 3130AJ7E3 02/17/23 4,119,928.20 0.00 0.00 0.00 0.00 14,210.58' 4,103,466.10 FEDERAL FARM CREDIT GSE 2,000,180.00 0.00 0:00. 0.00 0.00 0.00 2,000,180.00 BANKS FUNDING CORP 02/21/23 2,064,156.84 0.00 0.00 0.00 0.00 60,559.93 2,060,718.72 3133ELNWO 2,064,156.84 2,000,158.79 • FEDERAL FARM CREDIT 2,657,600.00 2,657,600.00 GSE 0.00 0.00 0.00 0.00 0.00 BANKS FUNDING CORP 03/08/23 2,664,235.15 0.00 0.00 0.00 0.00 13,000.60 2,657,307.12 3133EJFK0 2,664,235.15 2,644,306.52 FEDERAL HOME LOAN 2,040,460.00 2,040,460.00 GSE 0.00 0.00 0.00 0.00 0.00 BANKS 03/10/23 2,103,551.64 0.00 0.00 0.00 0.00 61,236.10 2,096,925.40 3 13382AX I 2,103,551.64 2,035,689.30 •FEDERAL HOME LOAN GSE 3,494,050.00 0.00 0.00 0.00 0.00 0.00 3,494,050.00 MORTGAGE CORP 04/20/23 3,508,884.68 0.00 0.00 0.00 0.00 15,121.57 3,509,549.50 3137EAEQ8 3,508,884.68 3,494,427.94 FEDERAL NATIONAL 0.00 998,017.00 GSE 998,017.00 0.00 0.00 0.00 0.00 MORTGAGE ASSOCIATION 05/22/23 0.00 (76.39) 0.00 0.00 0.00 882.00 998,949.84 3 135G04Q3 0.00 998,067.84 FEDERAL HOME LOAN 0.00 3,634,356.60 GSE 3,634,356.60 0.00 0.00 0.00 0.00 MORTGAGE CORP 06/26/23 0.00 0.00 0.00 0.00 0.00 4,921.70 3,639,326.56 3 137EAES4 0.00 3,634,404.86 • FHMS K-013 A2 GSE MBS 764,179.69 0.00 0.00 0.00 2,483.75 (3.84) 763,536.14 3I37AA4W0 01/25/21 759,365.85 0.00 0.00 (631.61) 0.00 4,122.39 757,404.99 759,365.85 753,282.60 FN AB5396 GSE MBS 207,537.76 0.00 0.00 0.00 491.94 (171.02) 194,134.18 31417137J0 06/01/22 207,379.85 0.00 0.00 (12,708.58) 0.00 6,998.19 193,398.30 207,379.85186,400.11 FHMS K-030 Al GSE MBS 240,591.36 0.00 0.00 0.00 560.72 36.94 232,172.47 247,794.6I 239,138.50 3137B3N95 09/25/22 247,794.61 • 0.00 0.00 (8,472.50) 0.00 6,484.57 232,653.93 FHMS K-026 A2 GSE MBS 1,000,429.69 0.00 0.00 0.00 2,091.67 0.00 1,000,429.69 1,039,352.00 1,040,015.20 3137E I BSO 1 1/25/22 1,039,352.00 0.00 0.00 0.00 0.00 40,247.26 999,767.94 UNITED STATES TREASURY US GOV 0.00 0.00 0.00 0.00 5,625.00 0.00 0.00 912828XE5 05/31/20 0.00 0,00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Portfolio Activity Summary 06/01/2020to06/30/2020 Description Security Type Beginning Original Cost Purchases Sales Maturities Interest Received Realized Gain/Loss Ending Original Cost Identifier Final Maturity Beginning Market Value Ending Market Value Purchased Accrued Disposed Accrued Paydowns Transfers Unrealized Gain/Loss Beginning Book Value Ending Book Value UNITED STATES TREASURY US GOV 4,990,234.40 0.00 0.00 (5,000,000.00) 37,500.00 0.00 0.00 9I2828XU9 06/15/20 5,002,655.00 0.00 0.00 0.00 0.00 0.00 0.00 5,002,655.00 0.00 UNITED STATES TREASURY US GOV 4,008,906.24 0.00 • (4,000,625.00) 0.00 0.00 592.02 0.00 912828XH8 06/30/20 4,004,824.00 0.00 (31,785.72) 0.00 0.00 0.00 0.00 4,004,824.00 0.00 UNITED STATES TREASURY US GOV 1,493,320.32 0.00 0.00 0.00 0.00 0.00 1,493,320.32 9128282V I 09/15/20 1,504,980.00 0.00 0.00 0.00 0.00 4,169.26 1,503,699.00 I,504,980.00 I,499,529.74 UNITED STATES TREASURY US GOV 2,480,607.44 0.00 . 0.00 0.00 0.00 0.00 2,480,607.44 912828VZ0 09/30/20 2,489,696.55 0.00 0.00 0.00 0.00 10,680.39 2,486,189.48 ,2,489,696.55 ' 2,475,509.08 UNITED STATES TREASURY US GOV 1,007,578.12 0.00 0.00 0.00 0.00 0.00 1,007,578.12 912828WC0 10/31/20 1,006,367.00 0.00 0.00 0.00 0.00 4,644.99 I,005,I 67.00 912828WCO 10/31/20 0.00 0.00 0.00 0.00 4,644.99 I,006,367.00 1.000,522.0 I UNITED STATES TREASURY US GOV 3,990,468.76 0.00 0.00 0.00 0.00 0.00 3,990,468.76 912828PC8 I I/15/20 4;044,220.00 0.00 0.00 0.00 0.00 37,506.64 4,035,936.00 4,044,220.00 3,998,429.36, UNITED STATES TREASURY US GOV 725,254. • 68 0.00 0.00 0.00 7,250.00 0.00 725,254.88 912828A42 1I/30/20 731,541.68 0.00 0.00 0.00 0.00 5,286.64 730,324.40 73 I,541.68 725,037.76 • UNITED STATES TREASURY US GOV 3,375,695.30 0.00 0.00 0.00 0.00 0.00 3,375,695.30 3,449,405.40 3,443,829.40 9128283X6 02/15/21 3,449,405.40 0.00 0.00 0.00 0.00 49,323.99 3,394,505.41' UNITED STATES TREASURY US GOV 3,812,449.22 0.00 0.00 0.00 0.00 0.00 3,812,449.22 3,890,744.10 0.00 0.00 0.00 0.00 62,075.28 3,884,019.75 912828463 03/15/21 3,890,744.10 3,82 I,944.47 UNITED STATES TREASURY US GOV 4,978,515.65 0.00 0.00 0.00 0.00 0.00 4,978,515'.65 5,094,530.00 5,086,330.00 9128284G2 04/15/21 5,094,530.00 0.00 0.00 0.00 0.00 92,155.26 4,994,174.74 UNITED STATES TREASURY US GOV 7,222,142.61 0.00 0.00 0.00 0.00 0.00 7,222,142.61 7,472,217.98 0.00 0.00 0.00 0.00 204,459.14 7,459,435.80 912828Y20 07/15/21 7,472,217.98 7,254,976.66 UNITED STATES TREASURY US GOV 7,218,281.25 0.00 0.00 0.00 0.00 0.00 7,218,281.25 912828RC6 08/15/21 7,545,259.25 0.00 0.00 0.00 0.00 222,671.78 7,535,177.62 7,545,259.257,312,505.85 UNITED STATES TREASURY US GOV 4,728,187.49 0.00 0.00 0.00 0.00 0.00 4,728,I 87.49 912828F2I 09/30/21 4,923,748.80 0.00 0.00 0.00 0.00 149,134.33 4,916,251.20 4,923,748.80 4,767,1 16.87 UNITED STATES TREASURY US GOV 1,384,829.1 I 0.00 0.00 0.00 0.00 0.00 1,384,829.1 I 912828F96 10/31/21 1,410,395.25 0.00 0.00 0.00 0.00 26,230.17 1,408,515.62 1,410,395.25 1,382,285.45 Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 Portfolio Activity Summary 06/01/2020 to 06/30/2020 Description Security Type Beginning Original Cost Purchases Sales Maturities Interest Received Realized Gain/Loss Ending Original Cost Identifier Final Maturity Beginning Market Value Purchased Accrued Disposed Accrued Paydowns Transfers Unrealized Gain/Loss Ending Market Value Beginning Book Value Ending Book Value UNITED STATES TREASURY US GOV 4,722,949.22 0.00 0.00 0.00 0.00 0.00 4,722,949.22 9128285L0 1 1/15/21 4,883,779.40 0.00 0.00 0.00 0.00 162,396.96 4,873,495.80 4,883,779.40 4,71 1,098.84 UNITED STATES TREASURY US GOV 2,006,562.50 0.00 0.00 0.00 0.00 0.00 2,006,562.50 9I2828J76 03/31/22 2,057,578.00 0.00 0.00 0.00 0.00 50,031.34 2,055,000.00 2,057,578.00 2,004,968.66 UNITED STATES TREASURY US GOV 2,006,796.88 0.00 0.00 0.00 0.00 0.00 2,006,796.88 912828SV3 05/15/22 2,061,562.00 0.00 0.00 0.00 0.00 53,841.31 2,059,062.00 2,061,562.00 2,005,220.69 UNITED STATES TREASURY US GOV 1,584,843.75 0.00 0.00 0.00 14,765.63 0.00 1,584,843.75 9I2828XD7 05/31/22 1,628,524.80 0.00 0.00 0.00 0.00 43,963.93 1,626,310.35 1,628,524.80 1,582,346.42 UNITED STATES TREASURY US GOV 1,013,242.19 0.00 0.00 0.00 10,625.00 0.00 1,013,242.19 9I2828XG0 06/30/22 1,040,703.00 0.00 0.00 0.00 0.00 28,816.95 1,039,062.00 1,040,703.00 1,010,245.05 UNITED STATES TREASURY US GOV 997,304.69 0.00 0.00 0.00 0.00 0.00 997,304.69 912828YA2 08/15/22 1,029,219.00 0.00 0.00 0.00 0.00 30,465.26 1,028,281.00 1,029,219.00 997,815.74 UNITED STATES TREASURY US GOV 1,101,933.59 0.00 0.00 0.00 0.00 0.00 1,101,933.59 912828TJ9 08/15/22 0.00 0.00 0.00 0.00 32,337.28 1,135,191.20 1,133,944.90 1,135,191.20I,101,607.62 UNITED STATES TREASURY US GOV 3,002,578.14 0.00 0.00 0.00 0.00 0.00 3,002,578.14 3,097,500.00 3,094,218.00 912828258 08/31/22 3,097,500.00 0.00 0.00 0.00 0.00 92,283.27 3,001,934.73, UNITED STATES TREASURY US GOV 1,378,898.44 0.00 0.00 0.00 0.00 0.00 1,378,898.44 9I28283U2 01/31/23 1,428,574.05 0.00 0.00 0.00 0.00 52,396.80 1,426,412.70 I,428,574.05 1,374,015.90 _, ---II $137,390,534.43 $33,744,978.82 ($18,926,812.28 ^--- $137,624,895.52 Portfolio Total $139,901,286.33 ) ($13,775,000.00) $243,533.41 $454.09 $139,971,363.37 i $137,537,749.77 ($3,965.28) ($31,785.72) ($21,812.69) $0.00 $2,208,344.50 i -- - - --_ _- ---- -- --- - ---- -- $137,763,018.87 Sample Client Portfolio LT 1-3 Public Trust Advisors 29 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 • Disclaimers 06/0 I/2020 to 06/30/2020 This information is for the sole purposes of the client and is not intended to provide specific advice or recommendations.Please review the contents of this information carefully.Should you have any questions regarding the information presented,calculation methodology,investment portfolio,security detail,or any other facet of this information,please feel free to contact us. Public Trust Advisors,LLC(Public Trust)statements and reports are intended to detail our investment advisory activity as well as the activity of any client accounts managed by Public Trust.The custodian bank maintains the control of assets and executes and settles all investment transactions.The custodian statement is the official record of security and cash holdings transactions.Public Trust recognizes that clients may use these reports to facilitate record keeping;therefore,it is recommended that the client reconcile this information with their custodian bank statement.Many custodians use a settlement date basis that may result in the need to reconcile due to a timing difference.The underlying market value,amortized cost,and accrued interest may differ between the custodian and this statement or report.This can be attributable to differences in calculation methodologies and pricing sources used.Please contact your relationship manager or call us at(855)395-3954 with questions regarding your account. Public Trust does not have the authority to withdraw funds from or deposit funds to the custodian.Our clients retain responsibility for their internal accounting policies,implementing and enforcing internal controls,and generating ledger entries or otherwise recording transactions.The total market value represents prices obtained from various sources;it may be impacted by the frequency at which prices are reported,and such prices are not guaranteed.Prices received from pricing vendors are generally based on current market quotes but when such quotes are not available,the pricing vendors use a variety of techniques to estimate value.These estimates, particularly for fixed-income securities,may be based on certain minimum principal amounts(e.g.$1 million)and may not reflect all the factors that affect the value of the security including liquidity risk.The prices provided are not firm bids or offers.Certain securities may reflect N/A or unavailable where the price for such security is generally not available from a pricing source.The market value of a security,including those priced at par value,may differ from its purchase price and may not closely reflect the value at which the security may be sold or purchased based on various market factors.The securities in this investment portfolio,including shares of mutual funds,are not guaranteed or otherwise protected by Public Trust,the FDIC(except for certain non-negotiable certificates of deposit),or any government agency unless specifically stated otherwise. Clients may be permitted to establish one or more unmanaged accounts for the purposes of client reporting.Public Trust defines an unmanaged account as one where the investment direction remains the sole responsibility of the client rather than the Investment Manager.These accounts do not receive ongoing supervision and monitoring services.The Investment Manager does not make any investment recommendations and may not charge a fee for reporting on these accounts.The primary purpose for this service is to include unmanaged accounts owned by the client in the performance reports provided by the Investment Manager.The Investment Manager assumes no liability for the underlying performance of any unmanaged accounts or assets,and it is the client's sole responsibility for the accuracy or correctness of any such performance. Beginning and ending balances are based on market value plus accrued interest on a trade date basis.Statements and reports made available to the end user either from Public Trust or through the online reporting platform may present information and portfolio analytics using various optional methods including,but not limited to,historical cost,amortized cost,and market value.All information is assumed to be correct,but the accuracy has not been confirmed and therefore is not guaranteed to be correct.Information is obtained from third party sources that may or may not be verified.The data in this report is unaudited and is only applicable for the date denoted on the report.Market values may change day-to-day based on numerous circumstances such as trading volume,news released about the underlying issuer,issuer performance,etc.Underlying market values may be priced via numerous aspects as certain securities are short term in nature and not readily traded.Performance results are shown net of all fees and expenses and reflect the reinvestment of dividends and other earnings. Many factors affect performance including changes in market conditions and interest rates and in response to other economic,political,or financial developments.Investment involves risk including the possible loss of principal. No assurance can be given that the performance objectives of a given strategy will be achieved.Past performance is no guarantee of future results.Any financial and/or investment decision may incur losses. The investment advisor providing these services is Public Trust Advisors,LLC,an investment adviser registered with the U.S.Securities and Exchange Commission(SEC)under the Investment Advisers Act of 1940,as amended. Registration with the SEC does not imply a certain level of skill or training.Public Trust is required to maintain a written disclosure brochure of our background and business experience.If you would like to receive a copy of our current disclosure brochure,Privacy Policy,or Code of Ethics,please contact us. Sample Client Portfolio LT 1-3 Public Trust Advisors 0 DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 J PUBLIC® ; TRUST __u _ ADVISORS Contact Regional Office 201 E.Pine Street,Suite 750 Orlando,FL 32801 liV1.i Headquarters 717 17th Street,Suite 1850 1 \',. Denver,CO 80202 1 `. 1 ., / r ' ' \ '` !I j\ ,1 ; r i :I‘':).� �j,• ; 1 1 ;I 'I I ,1 ii i ,`i i I ' DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 MA Appendix DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 I. 1 Ell Team Biographies Client Relations John F Grady, III, CTP—Managing Director of Investment Advisory Services john.grady(a..publictrustadvisors.com John is a Managing Director of Investment Advisory Services for Public Trust and has more than twenty years of government, investment management, and public finance experience serving as an investment advisor for fixed-income assets for numerous public entities across the U.S. John's diverse client base throughout his career includes state agencies, counties, municipalities, school districts, higher education, water districts, utilities, transportation, healthcare, and special districts. His specific areas of expertise include investment program implementation with a full-scope treasury management approach; public finance debt transactions and bond proceeds investment strategies;development of cash flow models;and creating investment reports to meet industry and client-specific requirements. John is also a frequent speaker for the national, state,and local chapters of the GFOA. Prior to joining Public Trust, John served as the Vice President of Investment Advisory and Client Relationships for government and institutional clients at Cutwater Asset Management and as a Senior Managing Consultant with PFM Asset Management where he provided asset management and financial advisory services for public entities.John received both a Bachelor of Science in Business Administration in Finance and Insurance and a Minor in Economics as well a Master of Business Administration from the University of Florida. Rod Bettini—Director of Investment Advisory Services rodrigo.bettini@publictrustadvisors.com Rod is a Director of Investment Advisory Services for Public Trust based in Florida where he is responsible for business development and client relationships across the state of Florida. In this role, Rod provides clients with technical and analytical resources for treasury management and investment strategies. Before joining Public Trust, Rod most recently served as Director of Business & Program Development for the Milken Institute,a California based think-tank;he focused on developing and implementing their expansion into Latin America where he served as point person to the region's Family Office Principals, Pension Fund CIOs,and Fortune 100 corporate leaders. Rod received a Bachelor of Arts in Marketing from the University of South Florida and a Master of Business Administration from the University of Florida. Rod has been a featured speaker at regional, national, and global conferences for many organizations including the Government Finance Officers Association, the California Municipal Treasurers'Association,and more. He is a proud member of the Local Government Hispanic Network,a regional Board Member of the National Academy Foundation,and a LATAM Advisor to the Milken Institute. He is fluent in Spanish and Portuguese. Tom Tight—Managing Director Tom.tight@publictrustadvisors.com Tom is a Managing Director for Public Trust where he leads the investment advisory practice. He works closely with clients to provide portfolio strategy solutions based on their unique investment guidelines, cash flows,and risk tolerances.He also serves as a liaison between the client and the Portfolio Management and Credit Research teams. Prior to joining Public Trust, Tom worked at Cutwater Asset Management for ten years where he was responsible for business development nationwide and specialized in public sector and insurance company asset management solutions. He also worked in the fixed-income sector for both UBS PaineWebber and A.G. Edwards&Sons where he specialized in fixed-income portfolio management,structured fixed-income products,and public finance transactions.Tom received both a Bachelor of Science in Finance and a Master of Business Administration IlPublic Trust Advisors —Brevard Schools DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 I I 1 Team Biographies from St.Louis University. He is a corporate affiliate advisory member for the National Association of State Treasurers,a member of the Government Finance Officers Association,and a member of the State Finance Officers Foundation. Matthew Tight-Vice President matt.tight(a publictrustadvisors.com Matt is a Vice President of Investment Advisory Services for Public Trust based in Florida and is responsible for business development, investor relations, and client services. He works closely with clients' staff to provide vital analytical resources including cash flow analysis, portfolio strategy recommendations, and investment report modeling.Matt also serves as a liaison between the client and the Portfolio Management team. Prior to joining Public Trust, Matt was a Regional Director of Institutional Sales at Cutwater Asset Management and held similar titles at Friedman, Billings and Ramsey, Inc and Timber Hill Inc. He received a Bachelor of Art in English from Pepperdine University and is a Certified Government Investment Professional. Tommy Jordan—Regional Director, Marketing to m my.jordan epu bl ictru stadvisors.com Tommy is a Regional Director of Marketing for Public Trust based in Florida where he focuses on new business development and maintaining and expanding client relationships statewide. Adding to the continued growth in the Florida marketplace, he is extending the reach of the FLCLASS program in an effort to grow the participant base. Prior to joining Public Trust,Tommy worked for Cintas as a Business Management Trainee, Goodfellow Real Estate as a Market Investment Analyst,and Starcom MediaVest as an Associate. Tommy received a Bachelor of Science in Advertising with a minor in Communication from the University of Florida. He frequently attends conferences across the state such as the Florida Government Finance Officers Association, the Association of School Business Officials, and other regional municipal forums. Tommy is currently in the process of becoming a Certified Government Investment Professional through the Government Investment Officers Association. Mary Rose—Senior Associate in Marketing mary.roseapublictrustadvisors.com Mary is a Senior Associate in Marketing for Public Trust where she is responsible for Request for Proposal (RFP)administration, creating monthly and quarterly client reports, managing conference registration and preparations,and planning an annual investment seminar held in Orlando every fall. Prior to joining Public Trust, she held the position of Executive Director for Allgen Financial Services, Inc. where she worked closely with the owners of the firm to help manage their needs and goals. Mary also served as a Senior Administrative Assistant for William R. Hough & Co where she assisted bankers in the preparation of bids and proposals to municipalities for underwriting and/or financial advisor services. She is a Notary Public and has previously held the FINRA Series 7 and Series 63 licenses. 21Public Trust Advisors —Brevard Schools DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 MOW Team Biographies Portfolio Management Cory Gebel, CFA—Director, Portfolio Management cory.gebel(apublictrustadvisors.com Cory is a Director in Portfolio Management for Public Trust and is responsible for providing institutional portfolio management and investment advisory services to discretionary clients as well as communicating investment ideas and strategies. Before joining Public Trust,Cory worked for Bank of the West and Trust Point,Inc.as a Senior Portfolio Manager where he was the head of fixed-income strategy within the wealth management group overseeing strategy,trading, compliance,and surveillance over client assets. Cory received a Bachelor of Arts in Accounting from the University of Northern Iowa. He is a CFA charterholder,an Investment Advisor Representative,and a member of the CFA Society of Colorado. Mark Creger—Director, Portfolio Management mark.cregerapublictrustadvisors.com Mark is a Director and Senior Portfolio Manager for Public Trust where he is responsible for providing daily portfolio management oversight and investment advisory services for strategic clients in California and nationwide. He joined Public Trust in 2016 in conjunction with the acquisition of the BLX Group Investment Management, where he served as the Chief Investment Officer, and brought with him more than 18 years of experience working with public agencies and 50I(c)(3) organizations to develop customized portfolio management strategies for operating funds, reserve funds,and bond proceeds. Mark received a Bachelor of Business Administration from the University of Michigan.He is an Investment Advisor Representative, has passed Level II of the CFA program, and previously held FINRA Series 6, 7, 24, 63,and 66 licenses. Manuel San Luis—Vice President, Portfolio Management manuel.sanluisapublictrustadvisors.com Manuel is a Vice President and Portfolio Manager for Public Trust where he is responsible for the development and execution of portfolio strategy. He works closely with portfolio management to review market conditions and manage client portfolios in accordance with pre-established policy, statutes, and strategic guidelines. Prior to joining Public Trust in conjunction with the firm's acquisition of the BLX Group's Investment Management team, Manuel served as a Senior Portfolio Analyst at BLX. His role on the investment management team included assisting with the daily execution of ongoing portfolio management for approximately$I.1 billion in public fund portfolios. Manuel received a Bachelor of Arts in Economics with a minor in Public Policy from the University of California, Berkeley,has passed level II of the CFA Program, and is an Investment Advisor Representative. Neil Waud,CFA—Chief Investment Officer neil.waud(a publictrustadvisors.com Neil is the Chief Investment Officer(CIO)for Public Trust,a position he was promoted to at the beginning of 2018. As CIO, Neil is responsible for the development and implementation of firmwide investment strategy as well as the oversight of the portfolio management team. Previously, he has served as both a Director and a Senior Portfolio Manager for Public Trust where his focus was on the management of local government investment pools and select separately managed accounts across the country. Prior to joining Public Trust, Neil worked for Cutwater Asset Management as both a Vice President and Portfolio Manager. His responsibilities were similar though he primarily focused on the management of 3 ' Public Trust Advisors —Brevard Schools DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 LitiaM ED Team Biographies the separately managed accounts. Neil received a Bachelor of Arts in Economics from the University of Colorado, Boulder. He is a CFA charterholder and an Investment Advisor Representative. Randy Palomba,CFA—Managing Partner randy.palomba@publictrustadvisors.com Randy is a Managing Partner for Public Trust and has been with the firm since inception.With nearly thirty years of industry experience, he oversees the portfolio management team, offers support to junior members of the team, participates in the development and implementation of portfolio strategy, and directly manages several local government investment pools in multiple states.Prior to joining Public Trust, Randy served as a Director for MBIA/Cutwater Asset Management where he managed several local government investment pools and separately managed accounts. He also previously worked for the City& County of Denver in a variety of positions that included cash management and debt service functions. Randy received a Bachelor of Arts in Accounting from Western State Colorado University. He is a CFA charterholder, an Investment Advisor Representative, and a member of the CFA Society of Colorado. Aaron Joseph—Trade Operations Associate Aaron.joseph@publictrustadvisors.com Aaron is a Trade Operations Associate for Public Trust where he is responsible for the updating and maintaining of portfolio management and reporting tools; the reconciliation of local government investment pool (LGIP) assets, securities, and cash; and the facilitation of trade settlements. Within the company, he previously held the role of Associate in Client Services and Fund Accounting where he was responsible for LGIP accounting and various paperwork such as account registration and updating forms. Prior to joining Public Trust, Aaron worked for Janus Capital Group as both a Client Service Representative and a Research Associate where his responsibilities ranged from providing customer service to shareholders to organizing, analyzing,and disseminating large amounts of data.Aaron received a Bachelor of Arts in Business Economics from Penn State University. Carter Genoar—Credit Trader Carter.genoar@publictrustadvisors.com Carter is a Credit Trader for Public Trust in the Portfolio Management Department where he supports the firm's portfolio managers in the development and execution of the investment strategies on behalf of Public Trust clients. His focus is on identifying investment opportunities in fixed-income markets and coordinating with the Credit Research Department to identify relative value opportunities. Prior to this role,Carter began his tenure at Public Trust as an analyst in the Credit Research Department covering U.S. and international banks. He received a Bachelor of Science in Business Administration with a focus on Finance and a minor in Economics from the University of Denver. Carter is a Level II candidate in the CFA Program. Sean Fitzgerald—Senior Credit Analyst Sean.fitzgeraldna.publictrustadvi sors.com Sean is a Portfolio Manager for Public.Trust. He was previously a Senior Credit Analyst where he was responsible for analyzing and monitoring numerous sectors within the credit research function. He analyzed trends and data to prioritize risk associated with a range of fixed-income securities. Sean's primary.areas of focus pertained to fundamental credit analysis with respect to international financial 4lPublic Trust Advisors —Brevard Schools DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 cTLI BON Team Biographies institutions as well as the application of risk management parameters related to monitoring current exposures. Sean spent time in Paris, France, where he studied business activities, international finance, economic policy, corporate culture, and legal and political systems. He received a Bachelor of Science in Business Administration with a dual concentration on Finance and International Business from the University of North Carolina at Wilmington and has passed Level I of the CFA Program. Credit and Risk Management Kevin Berents.—Chief Risk Officer kevin.berents(a�publictrustadvisors.com Kevin is the Chief Risk Officer for Public Trust where he is responsible for the oversight of enterprise risk management as well as participating in the management of the Credit Research and Risk Management Team. Kevin previously served as the Head of Credit,where he was responsible for team management, issuer research and selection, macroeconomic research and analysis, and issuer and investor communication. Prior to joining Public Trust, Kevin worked in sell-side equities and institutional asset management. He also spent seven years as a Senior Legislative Staff Member in the U.S. Congress before transitioning to the investment sector. Kevin received a Bachelor of.Arts in English Literature from the University of Colorado,Boulder,a Master of Science in Finance from the University of Colorado, Denver, and completed studies toward a Master of Business Administration from the University of Virginia. He has passed Level II of the CFA program and is a member of the CFA Society of Colorado. Patrick Edler, CFA—Credit Research Analyst Patrick.edler(apublictrustadvisors.com Patrick is a Credit Research Analyst for Public Trust where he is responsible for covering and providing counterparty research and analysis for companies in which portfolio management may invest. His sectors include corporates (technology and industrials), government-sponsored enterprises, sovereigns, and municipals. Prior to joining Public Trust, Patrick most recently held the position of Financial Planning Analyst for AMG National Trust Bank where he conducted planning and analysis to provide tax, estate, and investment strategy advice to ultra-high net worth individuals and college endowments. Patrick additionally worked for Allianz Global Automotive China as a Summer Analyst where he conducted in-depth market research on the Chinese auto insurance and manufacturing sector.He received a Bachelor of Science in Finance from Colorado State University and is a CFA charterholder. Marcelo Alaniz, CFA—Credit Research Analyst Marcelo.aanizapublictrustadvisors.com Marcelo is a Credit Research Analyst for Public Trust where he is responsible for the fundamental credit analysis of corporate issuers through due diligence, sector and issuer research, conducting proprietary analysis, and writing reports for new initiations as well as credit reviews for the healthcare, energy, and consumer discretionary sectors.Prior to joining Public Trust,he most recently held the position of Credit Research Analyst for Great-West Financial where he performed fundamental credit analysis and reviews on investment-grade corporate issuers and provided rating change recommendation. Marcelo additionally worked for CenturyLink as a Lead Financial Analyst and S&P Global Market Intelligence as a Financial Research Analyst. He received a Bachelor of Science in Finance from the 5lPublic Trust Advisors —Brevard Schools DocuSign Envelope ID:68A084C7-63AF-4907-924A-8E3C31B1A2C0 1211 Team Biographies Metropolitan State University of Denver,is a CFA charterholder,and is a member of both the CFA Society of Colorado and the CFA Institute. Johnny Combs—Credit Research Analyst Johnny.combs(4ublictrustadvisors.com Johnny is a Credit Research Analyst for Public Trust where he is responsible for covering the corporate sectors. He analyzes trends and data to prioritize risk associated with a range of fixed-income securities. Prior to joining Public Trust,Johnny most recently worked for Partners Group where he was the project manager of several private equity and private debt funds. Johnny additionally worked for Janus Henderson Investors as a Securities Analyst where he reviewed derivative and fixed-income pricing for NAV calculations. He received a Bachelor of Business Administration in Finance with a Minor in Accounting from the University of Miami (FL) and has passed Level I of the CFA Program. Operations/Clients Services Christa Kronquist—Director of Operations ch rista.kronquist(apublictrustadvisors.com Christa joined Public Trust in 2014 and currently serves as the Vice President of Operations where she is responsible for overseeing the daily operations of client services and fund accounting, the operations of separately managed accounts, the coordination of the annual audits of the various Public Trust-managed LGIPs nationwide,and the preparation of the annual reports.Prior to joining Public Trust,Christa worked for State Street Bank and Trust as an Assistant Vice President where she managed daily operations for a variety of mutual fund clients and coordinated annual audits. Christa received a Bachelor of Science in Accounting from Northwest Missouri State University and a Master of Business Administration in Finance and Management from the University of Missouri, Kansas City. Jen Gosselin—Vice President jen.gosselin@publictrustadvisors.com Jen is a Vice President of Client Services and Operations for Public Trust where she is responsible for the management of the client onboarding process, provides hands-on training and support for clients, and develops and maintains relationships with key administrators. She has more than twenty years of industry experience in fixed-income securities for local government entities, trade settlements, repurchase agreements, portfolio oversight,and accounting operations. Prior to joining Public Trust,Jen worked with Cutwater Asset Management as an Assistant Vice President where she worked with portfolio management to set up new accounts,monitored trade settlements,and placed daily repurchase agreement trades.Jen received a Bachelor of Science in Business Administration with a focus on Accounting from Columbia College. Audrey Parker—Client Services Supervisor audrey.parker aapublictrustadvisors.com Audrey is the Client Services Supervisor for Public Trust where she is responsible for overseeing the Client Service Associates in their daily activities and scheduling their daily fund assignments, providing customer service including issue management and communication, and providing ongoing guidance, ` �^ 6IPublic Trust Advisors —Brevard Schools