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HomeMy WebLinkAbout*Other - BOCCto GRANT COUNTY COMMISSIONERS AGENDA MEETING REQUEST FORM (Must be submitted to the Clerk of the Board by 12:00pm on Thursday) REQUESTING DEPARTMENT: BOCC REQUEST SUBMITTED BY: CEMANELL CONTACT PERSON ATTENDING ROUNDTABLE: CEMANELL CONFIDENTIAL INFORMATION: DYES BNO DATE: 09/18/2024 PHONE:2931 Agreement /Contract ❑AP Vouchers ❑Appointment /Reappoinkv tment ❑Bids / RFPs /Quotes Award ❑Bid Opening Scheduled El Boards / Comm ittees ❑ARPA Related El Computer Related El County Code El Emergency Purchase El Budget ❑Employee Rel. ❑Facilities Related ❑Financial ❑Funds ❑Hearing El Invoices /Purchase Orders ❑Grants —Fed/State/County ❑Leases ❑ MOA / MOU ❑Minutes ❑Ordinances ❑Out of State Travel ❑Petty Cash ❑Policies ❑Proclamations ❑Request for Purchase ❑Resolution ❑Recommendation ❑Professional Serv/Consultant ❑Support Letter ❑Surplus Req. ❑Tax Levies ❑Thank You's ❑Tax Title Property ❑WSLCB Engagement Letter from D.A. Davidson & Co. to serve as a Bond Underwriter or Placement Agent related to the Limited Tax General Obligation Bond, Series 2025 financing for the Grant County Jail project and morgue project. If necessary, was this document reviewed by accounting? ❑ YES ❑ g N O ❑ N/A If necessary, was this document reviewed by legal? ❑ YES ❑ NO • N/A DATE OF ACTION: a L I DEFERRED OR CONTINUED TO: APPROVE: DENIED ABSTAIN D1: D2: 1 D3: WITHDRAWN: 4/23/24 September 19, 2024 Grant County, Washington Commissioner Cindy Carter Commissioner Danny Stone Commissioner Rob Jones 35 C Street NW, Ephrata, WA 98823 DADAVTDSoN 1=1XEQ INCOME CAPITAL MARKETS Columbia Center 701 5th Ave., Suite 4050 Seattle, WA 98104 (206) 389-4062 jnelson@dadco.com www.dadavidson.com/ficm D.A. Davidson & Co. member SIPC Re: Underwriter/Placement Agent Engagement Letter by D.A. Davidson & Co. Pursuant to MSRB Rule G-17 and G-23 Limited Tax General Obligation Bonds Dear Cindy, Danny, and Rob, On behalf of D.A. Davidson & Co. ("we" or "Davidson"), we are writing concerningthe potential issuance p of Limited Tax General Obligation Bonds, Series 2025 (the "Securities"). This letter confirms that Grant County, Washington (the "Issuer") engages D.A. Davison & Co. as Underwriter or Placement p Agent for the proposed oposed offering and issuance of the Securities, subject to the conditions and limitations described below. It is anticipated that this letter will be replaced and superseded by a bond purchase agreement or certificate purchase agreement p gr ement to be entered into bythe parties (the "Purchase Agreement")if andwhenthe securities are ricedfollowin p g completion of the offering process. 1. Services to be Provided by Davidson. The Issuerhereby engages Davidson to serve as manag ing Underwriter or Placement Agent of the proposed offering and issuance of the securities and in such capacity, achy, Davidson agrees to provide the following services: • Provide various financing scenarios for the Securities (i.e., term of the financing payment , a ment structure, prepayment options, etc.) • Provide a comparison of a public bond sale (with a rating) versus a private placement directlyban to a k • Review and evaluate the proposed terms of the offering and the Securities • Develop a marketing plan for the offering, including identification of potential investors • Assist in preparation and review of the official statement and offering documents Contact potential purchasers (the "Purchasers"), provide them with related financial information resp ond to their inquiries and, if requested, coordinate their due diligence sessions • If the Securities are to be rated, assist in preparing materials to be provided to securities en ratings agencies g cles (S&P Global Ratings or Moody's Investor Services) and in developing strategies for meetings and g g presentations with the ratings agencies, coach and prepare the Issuer for a rating presentation to the rating agency 1 • Consult with counsel and other service providers with respect to the terms of the Securities p Securities • Inform the Issuer of the marketing and offering process • Negotiate the terms, including the interest rate, and other terms of the Securities • Obtain CUSIP number(s) for the Securities and arrange for their DTC book -entry' eligibility • Plan and arrange for the closing and settlement of the issuance and the deliveryof the Securities • Perform such other usual and customary underwriting services as may brequested q ueste d by the Issuer • As Placement Agent, send out a Request for Proposal Term Sheet to various banks for a fixed interest rate bid. (With a private placement to a bank, there is no Official Statement and no rat ing presentation.) As Underwriter or Placement Agent, Davidson will not be required to purchase the Securities urines except pursuant to the terms of the Purchase Agreement, which will not be signed until successful completion p on of the pre -sale offering period. This letter does not obligate Davidson to purchase any of the Securities. 2. No Advisory or Fiduciary Role. The Issuer agrees: acknowledges and a(i)g gr the primary role of Davidson, as a Underwriter or Placement Agent, is to purchase securities for resale to inves tors, stors, in an arm s -length commercial transaction between the Issuer and Davidson and that Davidson has f inancial and other interests that may differ from those ofthe Issuer; (ii) Davidson is not acting as a municipal advisor, financial al advisor, or fiduciary to the Issuer and Davidson has not assumed any advisory or fiduciary responsibility to the Is su er with respect to the transaction contemplated hereby and the discussions, undertakings and procedures leading thereto p g (irrespective of whether Davidson has provided other services or is currently providing other services t p g o the Issuer on other matters or transactions); (iii) the only obligations Davidson has to the Issuer with respect to the transaction coon contemplated hereby expressly are set forth in this agreement; and (iv) the Issuer has consulted its own fin ancial ial an d/or mu nic ipal, legal, accounting, tax and other advisors, as applicable, to the extent it deems appropriate. If the Issuer desires to consult with and hire a municipal advisor for this transaction that has legal fiduciary duties to the Issuer the Issuer should separately engage a municipal advisor to serve in that capacity. In addition, the Issuer acknowledges receipt of a letter outlining g certain regulatory disclosures as required by the Municipal Securities Rulemaking Board and attached to this agreement as Exhibit �' A. The Issuer further acknowledges Davidson may be required to supplement or make additional disclosures as may be n e ce ss ary as the specific terms of the transaction progress. 3. Fees and Expenses. Davidson's underwriting fee/spread will be determined r' prior to the pricing of the Bonds. The underwriting fee/spread will represent the difference between the pric e e that Davidson pays for the Securities and the public offering price stated on the cover of the final official stateme nt. The Issuer shall be responsible for paying or reimbursing Davidson for all other costs of issuance including without limitation, bond counsel fee, rating agency fee, and all other expenses incident to the performance of the Issuer's p uer s obligations under the proposed Securities. 4. Term and Termination. The term of this engagement shall extend from the date of this letter to the closing of the offering of the Securities. Notwithstanding the forgoing, either party may terminate David son's engagement at anytime without liability of penalty upon at least 30 days' prior written notice to the oth er party. If Davidson's engagement is terminated by the Issuer, the Issuer agrees to compensate Davidson �' p ensate avidson for the services provided and to reimburse Davidson for its out-of-pocket fees and expenses incurred to the e date of termination. 2 5 . Limitation of Liability. The Issuer agrees neither Davidson nor its employees, officers, agents or affiliates shall have any liability to the Issuer for the services provided hereunder. 6. Miscellaneous. This letter shall be governed and construed in accordance with the laws of the State of Washington. This Agreement maynot be amended or modified except bymeans of a written instrument executed by both parties hereto_ This Agreement may not be assigned by either party without the prior written consent of the other party. If there is any aspect of this Agreement that you believe requires further clarification, please do not hesitate to contact us. If the foregoing is consistent with your understanding of our engagement, please sign and return the enclosed copy of this letter. Again, we thank you forthe opportunity to assist you with your proposed financing and the confidence you have placed in Davidson. Very truly yours, D.A. DAVIDSON & CO. By: James M. Nelson Managing Director, Public Finance Banker Accepted this day of September, 2024 Grant County, Washington Name (print): Cindy Carter, Chair SignaturC.- Title: 3 EXHIBIT A We are writingto provide you, as Commissioners ofGrantCounty, Washington("Issuer"), with certcertainsclosuiesrequired by the Municipal Securities Rulemaking Board (MSRB) Rule G-17 that relate to the off and issuance of Grant County, Washington, Limited Tax General Obligationproposed enn). Bonds, Series 2025 (the "Securities"). The Issuer has engaged D.A. Davidson & Co. ("Davidson") to serve as an Underwriter or Placement Agent, and not as a financial or municipal advisor, in connection with the issuance of the Securities. As part of our services as Underwriter or Placement Agent, Davidson may provide advice concerningthe structure, similar matters concernin the issuance of the Sec e, timing, terms, and other g Securities. The specific terms of our engagementwill be asset forth in a bond purchase agreement to be entered into by the parties if and when the Securities are priced following successful completion of the o fferin gp s. 1. Deal -Specific Conflicts of Interest Disclosures Davidson has identified the following actual or potential material conflicts: • An employee of the Underwriter is a Reviewing Member for the Washington Public ' Review � c Treasurer's Association Debt Policy Revw Panel. In this capacity, the employee participates in reviewing possible debt policies for potential issuers and is not compensated. 2. Transaction -Specific Disclosures Since Davidsonhas not recommended a "complex municipal securities financin "to the e Issuer, additional disclosures regarding the financing structure for the Underwriter are not required un der ndei MSRB Rule G 17. In accordance with the requirements of MSRB Rule G-17, if Davidson recom mends a "complex municipal securities financing" to the Issuer, this letter will be supplemented to provide disclosure sclosure of the material financial characteristics of that financing structure as well as the material financial risks of the financing that are known to us and reasonably foreseeable at that time. 3. Standard Disclosures A. Disclosures Concerning the Underwriter's or Placement Agent's Role: (i) MSRB Rule G-17 requires that an underwriter and placement agent deal p g fairly at all times with both municipal issuers and investors. (ii) An Underwriter's primary role is to purchase the Securities with a view to distribution in anarm s - length commercial transaction with the Issuer. A Placement Agent's primary role the sale and purchase of municipal g p rY is to facilitate P pal securities between the Issuer and one or more investors for which it will receive compensation. Underwriters and Placement Agents have financial cial and other interests that differ from thos e of the Issuer. (iii) Unlike a municipal advisor, Underwriters and Placement agents do not have ve a fiduciary duty to the Issuer under the federal securities laws and are, therefore, not required b federal q Y al law to act in the best interests of the Issu er without regard to their own financial or other interests. (iv) The Issuer may choose to engage the services of a municipal advisor with a fid uciary iduciary obligation to represent the Issuer's interest in this transaction. (v) An Underwriter has a duty to purchase the Securities fromthe Issuer at a fair an d reasonable puce, 4 but must balance that duty with its duty to sell the Securities to investors at Agent prices that are fair and reasonable. APlacement A g as a duty to arrange the purchase of the Securities from the Issuer at a fair and reasonable price, butmustbalance that dutywith a duty to the saleto Investors able; and arrange at prices that are fair and reason g (vi) The Underwriter or Placement Agent will review the official statem ent for the Securities in accordance with, and as part of, its respective responsibilities to investors lied to the facts a under the federal securities laws, as applied and circumstances of this transaction. 1 B. Disclosures Concerning the Underwriter or Placement Agent's Come � nsatron: (i) The Underwriter or Placement Agent will be compensated by a fee set for th in the bond purchase agreement or placement agent agreement, to be negotiated and entered into in connection Issuance of the Securities. Payment or receipt with the Y p of the fee will be contingent on the closing of the transaction and the amount of the fee or discount may be based, in whole or in art of the principal amount of the Securities. While thispart, onapercentage form of compensation is customary in the municipal securities market, it presents a conflict of interest since the Under writer or Placement Agent may have an incentive to recomme nd to the Issuer a transaction that is unnecessary or to recommend that the size of the transaction be larger than is necessar y, 4. Questions and Acknowledwnent. Davidson is registered as a broker -dealer with the U.S. Securities and Exchange Commission ("SEC") and the MSRB, and is subject regulations and rules on municipal securities activities established b the SEC and MSRB. The web site address for the MSRB is www.msrb.or . The MSRB Y g web includes educational material about the municipal securities market, as well as an investor brochure that describes the protections that may be provided by the MSRB rules and how to file a complaint with an appropriate regulatory authority. If you or any other Issuer officials have any questions or concerns about these disclosures, please make those questions or concerns known immediately to the undersigned. In addition o own financial and/or municipal, legal, a � ' you should consult with the Issuer's p g accounting, tax and other advisors, as applicable, to- the extent you deem appropriate. It is our understanding that you have the authority to bind the Issuer to any disclosed conflict of interest relat' Y contra ct with us, and that you are not a party ing to the subject transaction. If our understanding is incorrect lease notify the undersigned immediately. p We are required to seek your acknowledgement tha t at you have received this letter. Accordingly, please send me an email to that effect, or sign and return the enclosed copy of this letter tome at the address set forthbelow. Otherwise, an email read receipt from you or automatic response confirmingthat our email wa acknowledgement that you received these s opened by you will serve as an y ese disclosures. Depending on the structure of the transaction that the Issuer decides to pursue, or if additional actual or potential material conflicts are identified, we may be required to send you additional ' Y disclosures regarding the material financial characteristics and ri sks of such transaction and/or describing those conflicts. At that time seek your acknowledgement of receipt of an such , we also well p y additional disclosure 1 Under federal securities law, an issuer of securities has the primary responsibility for disc the official statement by the underwriter is solelyfor purposes p Y disclosure to Investors. The review of p rp s of satisfying the underwriter's obligations under the federa 1 securities laws and such review should not be construed by an issuer as a guarantee of the accuracy information in the official statement. or completeness of the