HomeMy WebLinkAboutA6181 - STANDARD & POOR'S RATINGS SERVICES EVALUATION Palma Berkowitz One Market,Steuart Tower.16^Floor
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December 1,2011
Mr.David H.Ready,Esq.
City Manager
City of Palm Springs
3200 E.Tahquitz Canyon Way
Palm Springs,CA 92262
Email:David.Ready@palmsprings-ca.gov
Dear Mr.Ready:
Thank you for your recent request for the Rating Evaluation Service ("Evaluation") from Standard &
Poor's Ratings Services("we"or"Standard&Poor's"). This agreement("Agreement"), including the
attached Terms and Condition and Exhibits A and B which are expressly incorporated herein and
made a part of this Agreement, sets forth the terms and conditions under which Standard&Poor's will
perform the Evaluation for the City of Palm Springs("you"or the"Client").
Exhibit describes the Evaluation the Client has requested, including a description of what each party
has agreed to provide to the other. Exhibit B describes the fees for the Evaluation. Payment of the
fees is not conditioned on any particular Evaluation outcome.
Please sign below to indicate that the Client accepts the statements contained in this Agreement,agrees
to comply in all respects with the terms and conditions in this Agreement, and acknowledges the
Client's full understanding of the scope and limitations of the Evaluation. Please return a signed copy
of this letter to me and terrence_streicher@standardandpoors.com.
Standard & Pooes is pleased to have the opportunity to be of service to you. For more information
please visit our website at www.standardandpoors.com. If we can be of help in any other way, please
contact us. Thant:you for choosing Standard&Poor's,and we look forward to working with you.
Sincerely,
Standard&Poor's Ratings Services,
a Standard&Poor's Financial Services LLC business
BY:
Pamela Berkowitz
Director
McGRAWHILL www,standardandpoors.com
CONFIRMED,AGREED AND ACCEPTED BY CLIENT
AS OF THE DATE FIRST ABOVE WRITTEN:
City of Palm Springs
By
I( VYMEN—S
THOMPSON,
Name:��rwp p Clerk
Title: C.2 11
Date: /
APPROVED BY CaY MANAGER
IZ1oalZoll tl-r $IS�
C.C. Terrence Streicher,S&P-NYC fir(0 18 I
Suzanne Harrell,Harrell &Company Advisors
as
Not to Exceed
Without The Express s Written
Authorization Of The City
Manager
Exhibit A
Standard&Poor's Rating Evaluation Service
Description of the Evaluation
Client will provide to Standard&Poor's:
• Signed engagement letter.
• A detailed explanation of the hypothetical scenario(s) to be evaluated (including any relevant
tax information). The Client and Standard & Poor's have agreed that the Evaluation will
consist of an analysis of one hypothetical scenario and one Rating Evaluation Committee. The
Client understands and agrees that the fee set forth in Exhibit B may be increased if the Client
asks Standard&Poor's to analyze additional and/or different hypothetical scenarios.
• Client's pro-forma income, balance sheet and cash flow statements, if needed.
• Other relevant information requested by Standard&Poor's.
Standard&Poor's will provide to the Client in verbal and written format:
• A detailed letter indicating the impact of the hypothetical scenario on the Client's current
ratings,and supporting rationale.
• An explanation of adjustments and assumptions used to derive prospective credit ratios and
resulting ratings impact of the hypothetical scenario(s)based on the information provided to us.
Services that Standard&Poor's will not perform:
• Providing commentary on matters of public policy.
• Tax analysis of any hypothetical scenario submitted.
• Assistance in formatting or formulating a hypothetical scenario.
• Recommendation as to the type of debt and/or equity the Client should sell or any other advice.
Exhibit B
Standard&Poor's Rating Evaluation Service
Fee
The fee for the Evaluation outlined in Exhibit A will be$15,000,
An additional fee of$5,000 will be assessed for each subsequent time(after the first Rating Evaluation
committee)scenarios are presented for evaluation by our Rating Evaluation committee.
Please note that if the hypothetical scenarios the Client provides to Standard& Poor's and/or the data
and other information presented are different from or more complex than has been described, Standard
and Pooes reserves the right to increase the fee set forth above. Standard &: Poor's will notify the
Client if the fee is expected to be higher than the amount stated above.
In the event this Agreement is terminated by the Client after Standard & Poor's begins its analytical
review or if Standard& Pooes cannot complete the Evaluation because of lack of information and/or
cooperation from the Client, the Client shall pay Standard & Poor's for work completed prior to the
termination date based on Standard&Poor's time, effort and charges incurred with a minimum fee of
$11,500.
The Client agrees to pay the fee as described in this Exhibit B. Payment of the fee is not conditioned
on any particular Evaluation outcome. Standard &Poor's will invoice the Client for the fee when the
Evaluation results from the first Rating Evaluation committee are provided, or upon any earlier
termination. Payment is due upon receipt of the invoice.
The parties further agree to amend the attached Terris and Conditions by deleting the paragraph titled
"Governing Lase"and adding the following clause:
"Reservation of Rights. The parties to this Agreement do not waive, and reserve the right to contest,
any issues regarding sovereign immunity, the applicable governing law and the appropriate forum for
resolving any disputes arising out of or relating to this Agreement."
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STANDARD
& POORtS
RATINGS SERVICES
Standard&Poor's Ratings Services
Terms and Conditions
Applicable To
Rating Evaluation Service-the Americas
1. Scone of Services. It is understood and agreed that (i) the Evaluation is confidential and is
provided by Standard & Poor's solely for the Client's internal use and confidential
dissemination in accordance with the "Confidential Dissemination' paragraph below, (H) the
Evaluation is based solely on hypothetical scenarios and other information provided to Standard
& Poor's by Client, (iii) Standard & Poor's does not perform an audit in connection with any
Evaluation and an Evaluation does not represent an audit by Standard& Poor's,(iv) Standard&
Poor's relies on the Client and the Client's accountants, counsel and other experts for the
accuracy and completeness of the information presented in connection with the Evaluation, (v)
Standard & Poor's undertakes no duty of due diligence or independent verification of any
information, (vi) Standard & Poor's does not and cannot guarantee the accuracy, timeliness or
completeness of information relied on by Standard& Poor's in providing the Evaluation or the
results obtained from use of the Evaluation, (vii) Standard & Poor's is not acting as an
investment or financial advisor to the Client in connection with providing the Evaluation and the
Client may not rely on the information provided by Standard & Poor's as investment or
financial advice, and(viii)nothing in this Agreement creates, is intended to create or should be
construed as creating a fiduciary relationship between Standard & Poor's and the Client.
Clients who engage Standard&Poor's to perform an Evaluation and have a current Standard&
Poor's rating understand and agree that the Evaluation will not have an impact on or delay the
ongoing ratings surveillance process or any resulting rating action. It is understood and agreed
that the Evaluation may include information that may appear to be advice and
recommendations; but all decisions in connection with the implementation of any course of
action based on any such advice or recommendation or other service furnished by Standard &
Poor's shall be the sole responsibility of;and by, Client. In the event of a claim by a third party
relating to services under this Agreement, Client will indemnify Standard & Poor's and its
personnel from all such claims, liabilities,cost and expenses except to the extent determined to
have resulted from the gross negligence or willful misconduct of Standard& Poors personnel.
It is understood and agreed that Standard&Poor's has not consented to and will not consent to
being named an "expert"under applicable securities laws, including without limitation Section
7 of the Securities Act of 1933. Client may not use the Evaluation or any portion thereof in any
registration statement,offering document or public filing under any applicable law.
2. Confidential Dissemination. The Evaluation results, including the final letter or report will be
provided by Standard&Poor's to the Client on a confidential basis. The Client is permitted to
disseminate the Evaluation for internal use and to interested third parties on a confidential basis
but only in accordance with applicable law and only if a copy of the final Evaluation letter or
report is ,provided in its entirety to all recipients without any changes. If the Evaluation
subsequently becomes public through disclosure by the Client or a third party other than
Standard&Poor's, Standard&Poor's reserves the right to publicly comment on the Evaluation
and/or publish the final Evaluation letter or report.
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3. Information to be Provided by the Client. The Client agrees to provide Standard & Poor's
promptly with the hypothetical scenarios and all information relevant to the Evaluation
including information on material changes to information previously supplied to Standard &
Poor's. The Evaluation may be affected by Standard & Poors opinion of the accuracy,
completeness, timeliness, and reliability of information received from the Client or its agents.
Standard & Poors undertakes no duty of due diligence or independent verification of
information provided by the Client or its agents. Standard & Poor's reserves the right to
withdraw the Evaluation if the Client or its agents fails to provide Standard & Poor's with
accurate, complete, timely, or reliable information. Client shall be responsible for the
performance of its employees and agents and for the accuracy and completeness of all data and
information provided to Standard&Poor's in connection with the Evaluation.
4. Confidential Information. For purposes of this Agreement "Confidential Information" shall
mean information received by Standard & Poor's from the Client which has been marked
"Proprietary and Confidential"or in respect of which Standard& Poor's has received from the
Client specific written notice of its proprietary and confidential nature. Notwithstanding the
foregoing, information disclosed by the Client shall not be deemed to be Confidential
Information, and Standard & Poor's shall have no obligation to treat such information as
Confidential Information,if such information(i)was substantially known by Standard&Poor's
at the time of such disclosure, (ii) was known to the public at the time of such disclosure, (iii)
becomes known to the public (other than by Standard & Poor's act) subsequent to such
disclosure, (iv) is disclosed lawfully to Standard& Poor's by a third party subsequent to such
disclosure, (v) is developed independently by Standard & Poor's without reference to the
Confidential Information,(vi)is approved in writing by the Client for public disclosure, or(vii)
is required by law to be disclosed by the Client or Standard & Poor's provided that notice of
such required disclosure is given to the Client. Commencing on the date hereof, Standard &
Poor's will use Confidential Information only in connection with the Evaluation and with the
assignment and monitoring of ratings and will not directly disclose any Confidential
Information to any third party. Standard & Poor's may also use Confidential Information for
research and modeling purposes provided that the Confidential Information is not presented in a
way that can be directly tied to the Client. The Client agrees that Confidential Information may
be used to raise, lower, suspend, withdraw, place on CreditWatch, and change the Outlook
assigned to any rating if the Confidential Information is not directly disclosed.
5. Standard & Door's Not an AdviSM Fiduciary, or Expert. The Client understands and
agrees that Standard & Poor's is not acting as an investment, financial, or other advisor to the
Client and that the Client should not and cannot rely upon the Evaluation or any other
information provided by Standard & Poor's as investment or financial advice. Nothing in this
Agreement is intended to or should be construed as creating a fiduciary relationship between
Standard & Poor's and the Client or between Standard & Poor's and recipients of the
Evaluation. The Client understands and agrees that Standard&Poor's has not consented to and
will not consent to being named an "expert" under the applicable securities laws,including
without limitation, Section 7 of the U.S. Securities Act of 1933.
6. Limitation on Damages. Client agrees that Standard & Poor's, its officers, directors,
shareholders and employees shall not be liable to Client or any other person for any actions,
damages,claims, liabilities,costs,expenses,or losses in any way arising out of or relating to the
Evaluation for an aggregate amount in excess of the aggregate fees paid to Standard& Poor's
under this Agreement, except for Standard& Poor's gross negligence or willful misconduct. In
no event shall Standard&Poor's, its officers, directors, shareholders or employees be liable for
consequential, special, indirect, incidental, punitive or exemplary damages, costs, expenses,
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legal fees, or losses (including, without limitation, lost profits and opportunity costs). In
furtherance and not in limitation of the foregoing, Standard&Poor's will not be liable in respect
of any decisions made by Client or any other person as a result of the performance by Standard
& Poor's of its services hereunder or based on anything that appears to be advice or
recommendations. The provisions of this paragraph shall apply regardless of the form of action,
damage, claim, liability, costs, expenses or loss, whether in contract, statute, tort (including,
without limitation, negligence), or otherwise. Client acknowledges and agrees that Standard &
Poor's does not waive any protections, privileges or defenses it may have under law, including
but not limited to,the First Amendment of the Constitution of the United States of America.
7. Limitation on Warranties. THIS AGREEMENT IS A RATING EVALUATION
SERVICE ENGAGEMENT. STANDARD & POOWS WARRANTS THAT IT WILL
PERFORM THE EVALUATION IN GOOD FAITH. STANDARD & POOR'S
DISCLAIMS ALL OTHER WARRANTIES, EITHER EXPRESS OR IMPLIED,
INCLUDING, WITHOUT LIMITATION, WARRANTIES OF MERCHANTABILITY
AND FITNESS FOR A PARTICULAR PURPOSE.
8, Term. Unless terminated sooner in accordance with its terms, this Agreement shall terminate
on the completion of the Evaluation. This Agreement may be terminated by either parry at any
time by giving written notice to the other party.
9. Survival. The provisions of Paragraphs 1, 2, 4, 5, 6, 7, 8, 9, 10, 11, 12 and 13 hereof shall
survive the expiration or termination of this Agreement.
10.Assignment. Except as provided below, neither party may assign, transfer or delegate any of
the rights or obligations hereunder without the prior written consent of the other party. Standard
& Poor's may assign its rights and obligations hereunder to any affiliate that is a successor in
interest to all or substantially all of the assets or business of Standard & Poor's without the
consent of the Client.
11. Severability. In the event that any term or provision of this Agreement shall be held to be
invalid, void or unenforceable, then the remainder of this Agreement shall not be affected,
impaired or invalidated, and each such term and provision of this Agreement shall be valid and
enforceable to the fullest extent permitted by law.
12. Complete Agreement. This Agreement constitutes the complete agreement between the
parties with respect to its subject matter. This Agreement may not be modified except in a
writing signed by authorized representatives of both parties.
13. Governing Law. This Agreement and the Evaluation letter or report shall be governed by the
internal laws of the State of New York. The parties agree that the state and federal courts of
New York shall be the exclusive forums for any dispute arising out of this Agreement and the
parties hereby consent to the personal jurisdiction of such courts.
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