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HomeMy WebLinkAboutC35200 - US Bank Global Corp Trust Svcs as Corporate TrusteeCONTRACT NO. C35200 CITY OF PALM DESERT OFFICE OF THE CITY TREASURER STAFF REPORT REQUEST: RECOMMEND APPROVAL OF U.S. BANK GLOBAL CORPORATE TRUST SERVICES AS A CORPORATE TRUSTEE, AND AUTHORIZATION FOR THE CITY TREASURER TO SIGN ANY DOCUMENTS INVOLVED IN THE TRANSFER OF TRUSTEE SERVICES. SUBMITTED BY: Paul S. Gibson, CCMT, City Treasurer CONTRACTOR: U.S. Bank Global Corporate Trust Services Attention: William J. Jennings, Managing Director 633 W. Fifth Street, 24`h Floor Los Angeles, CA 90071 DATE: April 14, 2016 CONTENTS: • Staff Report • Exhibit "A": Comparison Of Trustee Proposals • Exhibit "B": U.S. Bank Global Corporate Trust Services RFP • Exhibit "C": U.S. Bank Tri-Party Agreement Recommendation By minute motion, approve U.S. Bank Global Corporate Trust Services as a corporate trustee for the City of Palm Desert and the RDA Successor Agency for a five-year term, commencing May 1, 2016, and authorization for the City Treasurer to sign any documents involved in the transfer of trustee services. Committee Recommendation At its regular March 22, 2016 meeting, the Palm Desert Audit, Finance, and Investment Committee voted unanimously to recommend that the City Council receive and file the report as presented. Strategic Plan Obiective Not Applicable. CONTRACT NO. C35200 Staff Report Selection of 2016 Corporate Trustee April 14, 2016 Page 2 of 3 Executive Summary The City's contract with Wells Fargo Corporate Trust Services expires on May 13, 2016. An RFP for Corporate Trust Services was circulated, published, and posted. Northern Trust Company, Wells Fargo Corporate Trust Services, and U.S. Bank Global Corporate Trust Services were invited to bid. Only Wells Fargo and U.S. Bank responded. Both were interviewed and referenced. Both had good references. U.S. Bank was more price competitive, offering a flat rate of $1,500 per bond issue for trustee fees over five years. Wells Fargo offered an escalating rate of $4,000 to $5,000 per bond issue over the same time period. Staff recommends that the City Council approve U.S. Bank as the City's corporate trustee, effective May 1, 2016, so that savings of $352,000 in trustee fees may be achieved over five years. Background Wells Fargo Corporate Trust Services has served as a corporate trustee for the City of Palm Desert ("City") and the Palm Desert RDA Successor Agency ("RDA S.A.") since 2006. The relationship has been excellent. The contract between the City and Wells Fargo expires on May 13, 2016. The City Treasurer's Office accordingly issued a Request for Proposals ("RFP") for Corporate Trust Services on January 6, 2016. A Notice Inviting Proposals was published twice in the Desert Sun, and posted on the City Hall Bulletin Board. The City invited the following three firms to submit proposals: • The Northern Trust Company (Chicago, Illinois) • U.S. Bank Global Corporate Trust Services (Minneapolis, Minnesota). • Wells Fargo Corporate Trust Services (San Francisco, California). Northern Trust is the third -largest trust company in the U.S in terms of trust assets; Wells Fargo is the fourth -largest; and U.S. Bank is the seventh -largest. Northern Trust declined to submit a proposal, indicating that it was no longer in the municipal trust business. Wells Fargo and U.S. Bank both submitted proposals. The City Treasurer's Office interviewed both candidates, and referenced them. What follows is a comparative summary on key points. Price. U.S. Bank has the lowest trustee fees for 22 bond issues over five years (Wells Fargo: $517,000. U.S. Bank: $165,000). On a per unit basis, it breaks down to: (Wells Fargo: $4,000 Year 1. $4,500 Year 2. $5,000 Years 3-5. U.S. Bank: $1,500 Years 1-5). U.S. Bank has the lowest fees for prime and government money market funds (Wells Fargo: 0.20 percent. U.S. Bank: 0.18 percent). Neither firm charges 12b-1 fees. The City and the RDA S.A. currently have a combined total of $41.6 million invested in trustee money market funds. HAMORD 2007\CORRESPONDENCE\INTERNAL\CITY COUNCIL\2016 BOND TRUSTEE AWARD.doc CONTRACT NO. C35200 Staff Report Selection of 2016 Corporate Trustee April 14, 2016 Page 3 of 3 Customer Service. U.S. Bank has the largest Los Angeles -based staff for municipal debt administration: (Wells Fargo: 10 employees. U.S. Bank: 46 employees). Martin Meza, the U.S. Bank employee who would be administering the City's trust accounts, has 21 years of experience in corporate trust services. He has very favorable references. Operations. U.S. Bank administers the largest amount of municipal debt (Wells Fargo: $415 billion. U.S. Bank: $1.29 trillion). U.S. Bank also administers the largest number of bond issues that are invested in LAIF accounts. In summary, based upon pricing, staffing, and municipal debt experience, Staff recommends that U.S. Global Corporate Trust Services be approved as the City's trustee for the period of 2016-2021. U.S. Bank has taken market share away from Wells Fargo by becoming the lowest - cost provider of municipal trust services. Wells Fargo's pricing suggests that it may be gradually exiting the municipal trust business. Fiscal Analvsis The City will save $352,000 in trustee fees over a five-year period if it accepts U.S. Bank's proposal. Prepared By: ,✓ Thomas J. Metz, puty City asurer Approved By: John M. Wohlmuth, City Manager tjm Attachments (as noted) Reviewed By: �Z14 Paul S. Gibson, City Treasurer HAMORD 2007\CORRESPONDENCE\INTERNAL\CITY COUNCIL\2016 BOND TRUSTEE AWARD.doc CONTRACT NO. C35200 N W Q W {p H i1] D cc Fw W Q a F� po o U W r sc r a N 0 a LL cc 0 w 7• r d F� NQ a J _N Q U LL Y. z Q � m r 0 ui 64 40 U) w w w w r Q cc � Q LL w W �' ua LL w LL LU F- ❑ Q w ¢ z w LU Z Q Y w Z 0 ¢ Q � ❑ -1 ❑ Q w H Q CL Q U 4- i% ❑ w c rw 0 EXHIBIT "B" CONTRACT NO. C35200 Response to Request For Proposals Presented To City of Palm Desert Bond Trustee Services January 22, 2016 William J. Jennings Managing Director Business Development U.S. Bank Global Corporate Trust Services 213.615.6054 william.jennings@usbank.com embank CONTRACT NO. C35200- �banlc January 22, 2016 City of Palm Desert Attention: Rachelle Klassen, City Clerk 73-510 Fred Waring Drive Palm Desert, CA 92260-2578 Ladies and Gentlemen: William J. Jennings Managing Director U.S. Bank National Association Global Corporate Trust Services 633 West Fifth Street, 24°i Floor Los Angeles, CA 90071 Phone: (213) 615-6054 Fax: (213) 615-6199 Mobile: (602) 463-6093 william.ienninasB-usbank.com Re: Request For Proposals — Bond Trustee Services Thank you very much for the opportunity to respond to the RFP and propose Trustee services to the City of Palm Desert. U.S. Bank National Association ("U.S. Bank") is presently ranked by Securities Data Company as the number one provider of Municipal Bond Trustee services in the United States, as well as the largest such provider in the State of California. We are the highest rated major national banking organization, with a significant California presence and a wealth of Bond Trustee and Fiscal Agent experience. As such, we would bring the ideal combination of resources to the City. In addition to our expert capabilities in administering all types of debt securities issuances, we also provide our clients with an unsurpassed commitment of providing high quality, customer -focused trustee, fiscal agent, and paying agent services. At a time when many other financial institutions are divesting trust services and securities processing, U.S. Bank remains very active as an acquirer of these types of businesses. Over the past 23 years, U.S. Bank has acquired the Corporate Trust businesses of more than 20 financial institutions across the Country. These acquisitions continue to demonstrate our supreme commitment to our clients, our business, and the marketplace in general. We are looking forward to the opportunity of working with you and the rest of your financing team participants. U.S. Bank is a high quality, yet low cost provider of Corporate Trust services. We believe that we are the most qualified institution for the City's transactions, and we also feel that we are offering very competitive fees. Should another bidder offer fees that are lower than what we are proposing, please take into consideration the qualifications and experience that we provide. However, should the decision on trustee selection ultimately come down to fees, we would appreciate the opportunity to submit an alternate fee proposal. Please let me know if there are any questions or if I can provide any additional information. Thanks again for the opportunity to be of service. Since ly, illiam . Jennin s Manag' g Direct r CONTRACT NO. C35200 SECTION A RFP NO: 2016-1: CONTRACTING FORM Mail To: City of Palm Desert Attention: Rachelle Klassen, City Clerk 73-510 Fred Waring Drive Palm Desert, CA 92260-2578 For Information, Please Call: PAUL GIBSON 760.346.0611, x320 Please Type or Print in Black Ink Proposals must be received at the above address prior to 4:00 P.M. Pacific Standard Time on on Mondav, January 25, 2016. DESCRIPTION Provide bond trustee services as described in RFP No. 2016-1, under the terms and conditions contained in the Trust Services Contract. Name and Address of Offeror U.S. Bank National Association 633 W. Fifth Street, 24th Floor Los Angeles, CA 90071 Telephone: (213) 615-6054 City of Palm Desert Contract No.: 2016-1 Name and Title of Person Authorized to Sign Offer: William J. Jennings Vice President 2/2016 Sipalure of Offeror // Date NOTIFICATI0A AWARD (This section for City use only) Name and Title of Contracting Officer Paul S. Gibson, City Treasurer Signature of Contracting Officer Date CONTRACT NO. C35200 SECTION B RFP NO. 2016-1: MINIMUM QUALIFICATIONS CERTIFICATION I hereby certify that my firm meets all of the minimum qualifications that are listed below for RFP No. 2016-1. My firm agrees to notify the City of Palm Desert ("Municipality") Treasurer's Office immediately, in writing, if it is selected as the Municipality's trustee and cannot continue to meet said minimum qualifications. Minimum Oualifications. The firm must: 1. Be a trust company or a commercial bank (or a subsidiary of a parent bank holding company or corporation) that has the powers of a trust company; 2. Be subject to supervision or examination by federal or state banking regulatory authorities; 3. Have an corporate trust office that is physically located within the State of California; 4. Have at least $500 billion of trust assets under management; 5. Have at least five years of experience in providing institutional trust services; and 6. Be able to provide all of the "Required Services" that are specified in this RFP. The account representative who would be assigned to the relationship must execute this section. Firm:U.S. Bank National Association Signed:2 eain Meza Title: Vice President Date: January 22, 2016 A senior person in corporate trust services must execute this section. Firm:U.S. B National Association Signed: _ Wil ' J. J nnings Title: Vice Pr sident d Managing Director Date: January 22, 2016 2 CONTRACT NO. C35200 SECTION C RFP NO.2015-1: FEE PROPOSAL SERVICES Acceptance Fees (Conversion) Counsel Fees (Conversion) Trustee Fees Fiscal Agent Fees Paying Agent Fees Registrar Fees Transfer Agent Fees Defeasance Escrow Agent Fees Depository Agent Fees Tender Agent Fees Letter of Credit Draw Charges Bondholder Account Maint. Charges Wire Transfer Charges Redemption Charges Security Trade Charges Collateral Maintenance Charges Out -of -Pocket Charges Acceptance Fee (per new issue) ESTIMATED TOTAL DIRECT ANNUAL VOLUME UNIT PRICE FEE PRICE $ -0- $ -0- $ -0- $ -0- $ 1,500.00 (per issue) $ 1,500.00 (per issue) $ 1,500.00 (per issue) $ 1,500.00 (per issue) $ -0-* $ -0-* $ -0-* $-d- $ 500.00 (per escrow) $ 500.00 (per escrow) $ -0- $ -0- $ 1,000. (if applicable) $ 1,000.00 (if applicable) $ -0- $ -D- $ -0- $ -0- $ -0- $ -0- -0- $ -a- $ 50.00 (per trade) $ 50.00 (per trade) -0- $ At Cost (if any) $ At Cost (if any) $ $1,000.00 $ 1,000.00 $ $ TOTAL ANNUAL FEES $ $ * if any issues require only registrar 1 paying agent fees, a $500 annual charge would apply 3 CONTRACT NO. C35200 SECTION D RFP NO.2016-1 TRUST SERVICES QUESTIONNAIRE 1. Firm Name: U.S. Bank National Association 2. Contact Address: 633 W. Fifth Street, 24`h Floor Los Angeles, CA 90071 3. Contact Personnel: Account Administrator Name: Martin Meza Title: TEL: (213) 615-6062 Supervising Manager Name: Sheri Ball Title: Vice President TEL: (213) 615-6007 4. What is the total dollar amount of all outstanding institutional (government and non - government) bond principal that your firm manages under trust? What is the total dollar amount of outstanding municipal (city) bond principal that your firm manages under trust? U.S. Bank is one of the largest trustee banks for corporate and municipal securities. The total bond principal outstanding is $2.89 trillion. Municipal debt totals $1.29 trillion. 5. Please provide resumes for the account administrator, the supervising manager, and any other employees who would be assigned to the Municipality's account. Please identify the current average trust client caseload for each emplovee; academic background; relevant certifications; vears of experience in field; and years with your firm. Brief statements of the qualifications and experience for the members of the service team for the City of Palm Desert are as follows: Account Manager Martin Meza Vice President U.S. Bank National Association Global Corporate Trust Services 633 W. 5`h Street, 241h Floor Los Angeles, CA 90071 (213)615-6062 martin.meza@usbank.com 4 CONTRACT NO. C35200 Martin has over 28 years of experience in banking, with 21 years in Corporate Trust providing Bond Trustee services. He is highly experienced in administering a wide variety of municipal debt financing structures where U.S. Bank serves as trustee, fiscal agent, paying agent, and escrow agent. Martin has a high level of expertise with all aspects of account administration including review of legal documents, investment of trust funds, and maintaining compliance with indenture and other financing agreement requirements. Martin maintains high level interaction with investment bankers, financial advisors and corporate and governmental clients. Martin handles approximately 35 municipal client relationships. He holds a Bachelor's Degree from the University of Phoenix. Trust Review Lauren Costales Trust Review Analyst U.S. Bank National Association Global Corporate Trust Services 633 W. 5`h Street, 24'h Floor Los Angeles, CA 90071 (213) 615-6527 lauren.costales@usbank.com Lauren is a Trust Review Analyst in our Los Angeles office and would provide key support to Martin in the administration of this account relationship. Lauren is responsible for monitoring complex bond documents to ensure quality maintenance and adherence to bank and regulatory standards. Her specific job functions include — • Analyzing and interpreting bond and other financing documents to ensure compliance by the parties to mitigate risk; • Performing periodic account reviews and investment reviews; • Monitoring ticklers to ensure prompt completion of obligor and trustee duties. Lauren holds a J.D. from the University of the Pacific, McGeorge School of Law, and a B.A in Political Science from UCLA. 5 CONTRACT NO. C35200 Trust Finance Management Christina Hinz TFM Analyst U.S. Bank National Association Global Corporate Trust Services 60 Livingston Avenue St. Paul, MN 55107 (651) 466-6121 christina.hinz@usbank.com Christina is a Trust Finance Management Analyst located in our St. Paul office. She is currently responsible for all cash and asset management activities for a diverse set of Corporate Trust account relationships and works closely with the Account Manager to ensure efficient and accurate administration of assigned accounts. Specific job functions include — • Interpreting bond documents to decipher complex cash movement, legal requirements for releasing funds, calculation and timing of debt retirements and coordinating notifications to securities depositories and bondholders; • Monitoring cash balances and performing investment activities in compliance with governing documents; • Analyzing collateral valuations, as well as monitoring and enforcing adherence to financial and legal obligations of bond financing participants; • Monitoring debt service, redemption, and investment ticklers to ensure prompt completion of trustee duties. Christina holds a B.A. in Finance from Metropolitan State University in Minnesota. 6. Please provide five references from California cities that have an established relationship with the account administrator who is listed in Question 3. Indicate: (a) name of city; (b) contact person; (c) address; (d) telephone number; and (e) length of relationship. We are pleased to provide the following references: City of Anaheim Deborah Moreno Director of Finance 200 S. Anaheim Blvd., Suite 643 Anaheim, CA 92805 (714)765-4651 (since 1986) 11 CONTRACT NO. C35200 City of Camarillo Ronnie Campbell Director of Finance 601 Carmen Drive Camarillo, CA 93010 (805) 388-5320 (since 1998) City of Vista Lauren Warren, CPA Director of Finance/City Treasurer Finance Department 200 Civic Center Drive Vista, CA 92084 (760) 643.5367 (since 1992) City of Monrovia Mark Alvarado CPA Director of Finance / Assist. City Manager 415 S. Ivy Ave. Monrovia, CA 91016 (626) 932-5510 (since 2002) City of Bell Gardens Will Kaholokula Director of Finance 7100 Garfield Avenue Bell Gardens, CA 90201 (562) 806-7708 (since 2003) 7. Please provide two references from California cities that no longer have a relationship with your firm. Indicate: (a) name of city; (b) contact person; (c) address; (d) telephone number; and (e) length of relationship. Please explain why your firm no longer manages these accounts. The following references are for former client relationships. Both of these former clients had issued bonds for which U.S. Bank was the trustee, and each client's bond obligations with U.S. Bank have been paid in full. 7 CONTRACT NO. C35200 Point Loma Nazarene University George Latter 3900 Lomoland Drive VP, Finance San Diego, CA 92106 (619) 849-2317 City of Lake Elsinore Nancy Lassey* 130 South Main Street Finance Administrator Lake Elsinore, CA 92530 (951) 674-3124 ext. 215 *Please note that the Account Manager at U.S. Bank was Brad Scarbrough. The contact person at the City of Lake Elsinore from the time Brad handled the relationship is no longer with the City of* Lake Elsinore. That person, Mail Pressey, is now the Finance Director for the City of Salinas. His telephone number is (831) 758-7211. 8. Please identify the total number of professionals and support staff that your firm has in the corporate trust office that would serve the Municipality. There are 51 professionals working in our Corporate Trust office in Los Angeles. 9. How many of the employees in Question 7 devote a majority (>50%) of their time to municipal debt administration? The vast majority of account administration performed in our Los Angeles office is devoted to municipal debt. Approximately 46 people in this office spend a majority of their time serving our municipal clients. 10. What percentage of time does the account administrator who is listed in Question 3, devote to municipal debt administration? Martin devotes 100% of his account management time to the administration of municipal debt. 11. What is your firm's fiduciary classification? (check all that apply) ® Bank - National Association ❑ Bank — State Association ❑ Affiliate of Investment Bank ❑ Affiliate of Foreign Bank 8 ❑ Trust Company - National ❑ Trust Company —State ❑ Limited Purpose Trust Company ❑ Affiliate or Subsidiary of a Bank Holding Company CONTRACT NO. C35200 ❑ Joint Venture with Another ❑ Other (describe) Firm (describe) 12. Please describe your firm's ownership structure. If your firm is owned by a parent bank holding company or corporation, then please identify that entity's name; its net capitalization, where it is headquartered (city and state); and its current credit ratings from at least two nationally recognized credit rating agencies. U.S. Bank is a wholly owned subsidiary of U.S. Bancorp, a publicly traded corporate listed on the New York Stock Exchange and headquartered in Minneapolis. The net capital of U.S. Bancorp exceeds $45 billion as of 9/30/15. Current credit ratings are Al (Moody's), A+ (S&P) and AA (Fitch). 13. Where is your corporate trust services subsidiary headquartered (city and state)? U.S. Bank maintains 50 domestic and 2 European corporate trust offices. All domestic corporate trust offices operate as U.S. Bank National Association which is the primary subsidiary of U.S. Bancorp. All 50 offices provide localized Account Management to clients and much of our operational support comes from our offices in St. Paul, Minnesota and Milwaukee, Wisconsin. We have a significant presence in Los Angeles where we serve many municipal clients in Southern California. 14. Based upon currently available information, is your firm a possible merger or acquisition candidate? (check one) ❑ Yes ® No If "yes", please discuss and identify the possible merger partner or acquiring organization. 15. What federal or state banking regulatory authorities supervise or examine your firm? As a nationally chartered banking institution, the primary regulator of U.S. Bank is the Office of the Comptroller of the Currency. 16. What is the total amount of your firm's combined capital (exclusive of borrowed capital) and surplus as of September 30, 2015? Approximately $45.1 billion. CONTRACT NO. C35200 17. What is your firm's Tier 1 capital ratio (to risk -adjusted assets) as of September 30, 2015? 13.1% 18. Does your firm meet the new federal standards of higher capitalization? U.S. Bank is the top rated bank in the country and exceeds all current federal capitalization standards. 19. Does your firm have a corporate trust office that is physically located within the State of California? ❑ No If "yes", please identify the location, the business hours, and how long your firm has been providing corporate trust services in California. We maintain two fully staffed corporate trust office in California. They are located in Los Angeles and San Francisco. If we are selected, we would handle the account management functions from our Los Angeles office. The address is — 633 W. Fifth Street, 241h Floor Los Angeles, CA 90071 Normal business hours are 8 a.m. to 5 p.m. We have been providing corporate trust services in California for over 25 years as U.S. Bank. 20. Is your firm's institutional trust administration centralized at one physical location? (check one) ❑ Yes N No If "yes", please identify the city and state. 21. Does your firm own a securities clearing operation or does it subcontract that responsibility to another firm? (check one) N Own ❑ Subcontract If "subcontract", please identify the subcontractor and how long your firm has done business with the subcontractor. U.S. Bank is a direct participant with DTC and a member of the Federal Reserve so we clear all settlements ourselves. 10 CONTRACT NO. C35200 22. Where is the securities clearing operation located (city and state)? What is the time zone? What are the "cut-off' times for "cash" trades, corporate securities, Treasuries, Agencies, and bankers' acceptances? DTC Settlement is located in Milwaukee, Wisconsin and Fed Settlement is located in St. Paul, Minnesota. Both are in the Central time zone. Cut of times are set forth in the following grid: Transaction Type Securities eligible for DTC • Equities • Corporate & municipal bonds • Commercial paper • Medium -term notes • Collateralized mortgage issues • Zero coupon bonds — already at DTC Federal Reserve book -entry securities Includes treasuries, agencies, GNMAs Bank of New York — physical securities Instructions Deadline - Central Time 1:00 p.m. on S/D 12:30 p.m. on S/D 11:00 a.m. on S/D minus 1 Purchase of physical security to be held in 1 day prior to S/D Milwaukee vault. Includes private placements. Sale of physical security held in Milwaukee vault Proper documents must be included if asset is in customer's name Global, Euroclear, Cedel Options 2 days prior to S/D See Global deadlines. 1:00 p.m. Central Time 23. Which of the following investment instruments is your firm capable of clearing? (check appropriate choices) ® T-Bills ® Certificates of Deposit ® T-Notes ® Commercial Paper ® T-Strips ® Corporate MTNs and Bonds 11 CONTRACT NO. C35200 ® Bankers' Acceptances ® Mortgage -Backed Securities ® Repurchase Agreements ® Agencies (specify) 24. Please specify the hours (Pacific Standard Time/Pacific Daylight Time) when wire transfers may be done on the Municipality's behalf. The cut off time for outgoing wire is 1 p.m. Pacific. Cut off for incoming wires is 2:30 Pacific. 25. Please describe your firm's policy regarding failed transactions and its method of compensating customers in the event that your firm is at fault. Please provide a description of the compensation formula and the methodology that is used to calculate compensation. U.S. Bank settles client accounts on a contractual basis and fails are resolved internally with the counterparty. 26. How many and what percentage or your securities transactions failed last month? During the last 12 months? Average daily DTC fails in December 2015 were 562 buys (5%0 and 41 sales (0.4%). Average daily fails in 2015 were 492 fails (4.1%) and 54 sales (0.5%). Average daily Fed fails in December 2015 were 26 buys (3.2%) and 5 sales (1.1 %). Average daily fails in 2015 were 26 fails (3.1%) and 6 sales (1.0%). These statistics are for all of U.S. Bank Wealth Management and Securities Services which in addition to Corporate Trust, includes Wealth Management and Institutional Trust & Custody. 27. What is the aggregate policy limit on the coverage that your firm purchases for a Financial Institution Bond; excess securities insurance; banker's professional liability (errors and omissions) insurance; and mail insurance? Who are the insurance carriers? U.S. Bancorp is the fifth largest financial services holding company in the United States. It secures a variety of insurance coverages that are consistent and reasonable for an organization of its type and size. Deductibles, self -insured retentions, and risk management philosophy are reviewed by the board of directors on an annual basis. All participating insurance carriers are required to have an A.M. Best rating of ANIL Evidence of coverage, in the form of a Certificate of Insurance, is available where required by contract. 12 CONTRACT NO. C35200 Our insurance panel includes insurance carriers whom are regarded as some of the best in the business. Some examples are AIG, Lloyd's of London, ACE, XL, and Berkshire. 28. Where is the vault facility in which your firm would hold the Municipality's physical securities (street address, city, and state)? 1555 N. Rivercenter Dr. Suite 302, Milwaukee, Wisonsin 53212. 29. Please describe how your firm would ensure that all of the Municipality's securities that it holds in trust will qualify for a GASB 3, Category 1 rating. Will the Municipality's securities be registered in the Municipality's name or insured? As trustee, U.S. Bank complies with all GASB standards for our municipal / governmental clients. To the extent that investments held by us as trustee fall under GASB guidelines, any such securities held would qualify for a GASB 3, Category 1 rating. Any securities held in trust would be registered in the name of the Municipality. 30. Please identify and describe your firm's trust accounting data processing system; its reporting capabilities; how it can be accessed online; and the percentage or time, over the last 12 months, it has been inaccessible because of technical problems. Each bond financing is established on a number of computer systems, including our trust accounting system (SEI 3000), our bondholder recordkeeping system (BondMaster) and Account Control, which facilitates a number of administrative functions including ticklers and contact management. We offer on-line access to trust accounts that is user friendly and free of charge. An overview of our on-line trust reporting system, TrustNow Essentials follows: U.S. Bank TrustNow Essentials We offer on-line access to trust accounts that is user friendly and free of charge. Our clients have the capacity to access their trust accounting information on line through the use of our sophisticated online reporting system, TrustNow Essentials, which was created exclusively for customers of U.S. Bank Corporate Trust Services. TrustNow Essentials provides the ability to download a wide range of account and transaction information quickly and easily via the Internet. With TrustNow Essentials, account information can be downloaded in a format that works best for the user's needs. The following trust account data can be easily downloaded in a format that works best for the user: 13 CONTRACT NO. C35200 • Transaction history • Pending trades • Tax lot reporting • Cash balances • Account lists • Account summaries • Holdings • System codes. With TrustNow Essentials, users can - • Download trust account information in a variety of formats (Microsoft Excel, Adobe Acrobat PDF, comma separated, fixed or rich text) • Benefit from the highest level of security available online, protecting the user's privacy • Schedule unattended downloads to occur at the user's convenience. TrustNow Essentials also gives our clients the ability to obtain their trust account statements at any time. Statements can be accessed from our archives in standard PDF format directly from the user's computer. We have knowledgeable support staff members that are ready to provide technical assistance and answer your questions quickly and accurately. U.S. Bank TrustNow U.S. Bank TrustNow provides account and transaction information directly to users via the Internet. Clients can access real-time data on specific accounts at their convenience. This system is designed in particular for situations where a user only needs to access information on a limited number of accounts, or to track a specific transaction. TrustNow provides on -screen access to account summaries, transaction history, holdings, cash balances, and other information on individual accounts. Using a personal identification name and password, secure access is provided via our website. With TrustNow, users can access up to 20 accounts at one time, and even download data into an Excel spreadsheet or save in a PDF file. Account statements are available electronically from the earlier of April 1, 2001 (when the system went live) or the date the bond issue closes. Information for data downloads is available for 18 months. The user controls the date ranges of a report request within the 18 month window. There is a report that can be requested called Portfolio Snapshot that has the look and feel of a statement which date range is also in the 18 month window. 14 CONTRACT NO. C35200 31. Please describe the procedures that your firm would use to ensure that all of the Municipality's bonds are in compliance with their indentures of trust. With respect to indenture compliance, each appointment is reviewed by our "Trust Review" department when initially set up, as well as on a periodic basis. No fewer than two experienced corporate trust professionals review each account and all movement of funds to accurately identify all required actions and compliance items. Each account is established with a comprehensive set of ticklers to identify all required action items. As an industry leader, we use state-of-the-art technology, plus robust policies and procedures, to assure that we meet or exceed all service requirements. All aspects of servicing are subject to periodic internal, external and regulatory audits, and are monitored via an array of performance metrics. Our many performance benchmarks are established based on meeting or exceeding client service expectations, internal bank risk management needs, industry standards, internal and external audit recommendations, and regulatory requirements. 32. What is your bond registrar system? For many years, U.S. Bank had utilized SunGard's BondMaster system as our registrar, paying agent and transfer agent system. We have been working with SunGard (and now FIS who completed its acquisition of SunGard in 2015) toward conversion to the state of the art registrar and transfer agent system Stream TA (STA) for several years. The conversion from BondMaster to STA took place over the 1/15/16 — 1/18/16 holiday weekend. 33. How many successor trusteeships have you done over the last 12 months? With the Municipality's current trustee over the last 12 months? Over the last 12 months, U.S. Bank has been appointed as successor trustee for approximately 520 bond issues. We do not maintain a centralized system that shows detail on who the prior trustee was but suffice it to say that we have succeeded Wells Fargo on many issues in the last 12 months. 34. Will your firm charge acceptance fees and counsel fees for the Municipality's outstanding bond issues if it becomes the successor trustee? (check one) ❑ Yes ® No If "yes", please identify the charges in the Fee Proposal. 15 CONTRACT NO. C35200 35. Please describe the capabilities and the experience of your firm in providing all services that are listed under "Required Services" in this RFP. A. Bond Administration All of the bond administration services set forth in the RFP would be performed by our account service team, which consists of the Account Manager, with support provided by the assigned Trust Review Analyst and the Trust Finance Management Analyst. As the Number 1 ranked municipal bond trustee in the Nation and in the State of California, our capabilities and experience in all of the areas of Bond Administration are second to none and will be performed with the highest degree of care and skill. B. Clearing and Safekeeping Our Trust Operations Group, working closely with the account service team, will ensure that all securities transactions will clear on an accurate and timely basis, and that all such buys and sells will be transacted on delivery -versus -payment or receipt -versus -payment. Our Trust Operations group can clear all types of securities trades including Treasuries, Agencies, Commercial Paper, Bankers' Acceptances, as well as many other types of securities. We would safe keep all securities so that they qualify for a GASB 3, Category 1 rating. If we are selected to assume the role of Trustee as a successor to the present Trustee, we would accept all securities into safekeeping on a free -delivery basis. C. Trade Confirmations Whenever a receipt or delivery of securities takes place, a trade confirmation is generated from our trust accounting system and mailed to the client no later than one business day after the transaction has settles. D. Online Trust Reports We will provide access to our online trust account system, TrustNow Essentials. More information is contained above under item 30. E. Failed Trades In the event of a failed trade, we will provide timely, same day notification of such. 16 CONTRACT NO. C35200 F. Collect and Transfer Interest Our Income Collections area ensures timely collection of interest income, maturing proceeds and proceeds from the sale of securities. All such amounts are deposited to the applicable trust account. If there is an arrangement for such proceeds to be transferred to an account held by the Municipality we would do so as long as this would not violate any terms of a trust indenture or other operative trust document. G. Wire Transfers We will initiate and receive all required wire transfers. 36. Please describe any "Optional Services" that you believe would be of benefit to the Municipality. Any associated costs should be itemized in the Fee Proposal. We are not proposing any `optional services' at this time. However, U.S. Bank is a full service banking organization and if selected, we would be pleased to introduce you to our Government Banking people who can provide useful insight into many other products and services offered by U.S. Bank that could provide benefits to the City. 37. Please list and describe the money market funds that your firm offers as part of its automated cash sweep program. Please identify the number of basis points that the mutual fund company would charge and that your firm would charge for each fund. Can you firm rebate part of its charges to the City? If so, by how much? How would you calculate the rebate on a monthly basis? Please also identify the fund number or fund class for each fund. U.S. Bank offers a wide array of money market funds, both proprietary and non- proprietary, from many of the country's largest fund providers. Since providing the requested information for all would be overly lengthy, we are providing fact sheets for several such fund families which provide the applicable management fee charged by the fund provider. These are attached as Exhibit A. U.S. Bank does not charge anything over and above the management fee. We do not rebate any such charges. 38. Can your firm guarantee the fees and expenses that it listed in its Price Proposal for the five-year term of the proposed trust services contract? Yes, if selected we would agree to guarantee our fee structure for a five year term. 17 CONTRACT NO. C35200 39. Why should your firm be retained as the Municipality's trustee? Please elaborate on any competitive advantages that the Municipality would gain by selecting your firm, as opposed to other firms. We are a top -tier provider of trustee and agency services, and we presently rank as # 1 trustee bank for municipal securities, ranked by new trustee appointments. We are highly experienced with all kinds of public finance debt issues, and have particular expertise with assessment district and tax allocation bonds. U.S. Bank would bring a wealth of knowledge and processing capabilities to the City of Palm Desert. We have an unsurpassed commitment to the California municipal market, and we continue to be a full service provider of trustee and fiscal agent services. At a time when other trustee banks are consolidating their trust businesses, ceasing to provide particular trust services, or exploring an outright sale of all or part of their trust business, U.S. Bank continues to grow our business, particularly in California, and remains as a dedicated local provider of bond trustee and fiscal agent services. Global Corporate Trust Services is a core business at U.S. Bank and we continue to invest heavily in it. Our systems capabilities are state of the art and second to none. Our technological investments speed processing, enhance security, reduce costs, promote efficiency and are user friendly (and free). We offer internet access to trust account information which is user-friendly, secure and free of charge. Monthly statements are available through TrustNow Essentials ®. Real-time trust account data is available with TrustNow. Both features have been met with consistently high ratings from our clients who utilize them. There are a number of innovations and other aspects of our business that set us apart from our competitors. First is our unique service delivery structure. We maintain a staffing arrangement that ensures consistently superior service delivery to our customers. Our emphasis on specialization also promotes efficiency and provides superior data accuracy and responsiveness. We continue to automate many of the functions we perform as Trustee and. This concentration on automation ensures the highest levels of accuracy and efficiency and allows us to be very price competitive. In addition to our expert capabilities as trustee, we also provide our clients and the public finance markets with an unsurpassed commitment of providing high quality, customer - focused services. U.S. Bank remains very active as an acquirer of securities processing business such as Corporate Trust and Institutional Custody. Over the past 23 years, we have completed more than 20 acquisitions of other banks' trust businesses. These acquisitions continue to demonstrate our supreme commitment to our clients, their bondholders, and the debt finance markets in general. We believe that knowledge, experience and service should be the basis on which a trustee or fiscal agent is selected. However, we also recognize that clients need to contain their costs when bringing a debt financing to market. U.S. Bank provides high quality corporate 18 CONTRACT NO. C35200 trust services from knowledgeable and experienced professionals at very competitive fees. 40. Have any of your firm's public sector clients claimed, in writing, within the last 12 months, that your firm was responsible for any investment losses? (check one) ❑ Yes ® No If "yes", please describe each matter briefly. 41. Has your firm been subject to any litigation, arbitration, or regulatory proceedings, either pending, adjudicated, or settled, within the last 12 months, that involved allegations of improper, fraudulent, disreputable, or unfair activities related to the purchase, sale, or settlement of securities on behalf of institutional clients? (check one) ❑ Yes ® No If "yes", please describe each matter briefly. 42. Has your firm been subject to a regulatory, state, or federal agency investigation within the last 12 months, for alleged improper, fraudulent, disreputable, or unfair activities related to the purchase, sale, or settlement of securities? (check one) ❑ Yes ® No If "yes", please describe each matter briefly. 19 Prime Obligations Page 1 of 2 CONTRACT NO. C35200 Home Our Firm Contact Us Our Funds Investment Team Shareholder Documents Portfolio Holdings Tickers & CLISIPs Fund News % Yield as of 112012016 Yield I Subsidized 1 Day 0.02% 7 Day Current 0.02% Daily Dividend Factor 0 000000439 Total Net Assets $11.32 Billion as of 1/20/2016 Unsubsidized Weighted Average Maturity (WAM) -006 % 29 DAYS as of 1/20/2016 -0.07 Weighted Average Life (WAL) - Weekiy 31 DAYS as of 1/14/2016 The 7-day current yield quotation, rather than the total return quotation, more closely reflects the current earnings of the fund. Subsidized yields reflect fee waivers in effect Without such waivers, yields would be reduced. Unsubsidized yields do not reflect fee waivers in effect Daily Dividend Factor: The amount of dividends declared daily and paid monthly by the fund, expressed in dollars per share. It is calculated by dividing the one -day subsidized yield by 365 Fund Performance Weighted Average Maturtty (WAM): The average time to matunty of all the securtes held in the fund weighted by each security's percentage of total investments. WAM measures a fund's sensitivity to interest rate changes Weighted Average Life (WAL)The average time to final legal maturity of all the securities held in the fund, weighted by each security's percentage of total investments WAL measures a funds sensitivity to potential credit spread changes Cumulative Returns Average Annualized Returns as of 12/31f1015 as of 12f31/2015 1 min 3 mth I YTD 1 yr I 3 yr I 5 yr 0.00 000 002 002 0.01 001 Net Annualized Monthly Average Yields as of 12/31/2015 2010 2011 i 2012 January 000% 0.00% 0.00% February 0.00% 0 00 % 0.00% March 000% 000% 000% April 0 00% 0 00 % 0.00 May 000% 0.00% 0.00% June 000% 0 00 % 000% July 000% 0.00% 0.00% August 003% 000% 0.00% September 0 00% 0.00% 0.00 October 0 001y. 0.00% 0 00 November 0 00% 000% 0.00 December 0 00% 000% 000% 10 yr I Since Incept I Inception Date 123 3.01 3/1/1990 2013 12014 12015 000% 002% 002% 0.001/ 0.02 % 0 02 % 000% 002% 002% 0.00% 002% 002% 000% 002% 002% 000% 002% 002% 0.00% 002% 002% 000% 002% 002% 002% 002% 002% 002% 002% 002% 002% 002% 002% 002% 002% 002% Performance shown is historical and does not guarantee future results Current performance may be lower or higher. For current month -end performance information, call 800.677.3863. Performance assumes the reinvestment of dividends and capital gains ISelect a First American Fund of �l � �� EX111pf1RY by Cl1111111111i of DOi111kb CURR9ifTWM HOUDIRM January 14, 2016 MOMLY HOLD"M December 2015 November 2015 October 2015 September 2015 August 2015 July 2015 June 2015 May 2015 April 2015 March 2015 February 2015 January 2015 The fund is required to provide the Securities and Exchange Commission ("SEC") with a monthly electronic filing of more detailed portfolio holdings information on Forth N-MFP. The SEC will make the Form N-MFP available to the public 60 days after the end of the month to which the filing pertains Click here to access the fund's publicly available Form N-MFP filings on the SEC's websde http://www.institutionalinvestors.firstamericanfunds.comlhome/our-funds.aspxld=29331titl... 1 /21 /2016 Prime Obligations Page 2 of 2 CONTRACT NO. C35200 t First American Funds, Inc. began offering shares to the public on April 9, 1982. Mutual fund Investing Involves risk; principal loss is possible. Click two to view prospectuses. A fund's Investment objectives, risks, charges, and expenses should be considered carefully before investing. The prospectus contains this and other information. Please read carefully before investing. An investment in money market funds is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other governmental agency. Although these funds seek to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in these funds. U.S. Bancorp Asset Management, Inc. serves as investment advisor to First American Funds. The funds are distributed by Quasar Distributors. LLC, an affiliate of the investment advisor. The funds referred to in this website may be offered only to persons in the United States. This website should not be considered a solicitation or offering of shares of the funds outside the United States. NOT FDIC INSURED ; NO BANK GUARANTEE ; MAY LOSE VALUE: Sitemap Privacy Pledge Terms of Use 02016 U S Bancorp Asset Manapemem Ail Rights ReseNed http://www.institutionalinvestors.firstamericanfunds.com/home/our-funds.aspx/d=2933/titl... 1 /21 /2016 Federated Prime Obligations Fund (IS): Performance Page 1 of 2 CONTRACT NO. C35200 Website Sign In Customer Service My Investments Careers Literature and Forms search Home Products . Market Views . Retirement, Tools 3 Resources . About Federated . Federated Prime Obligations Fund (IS) mxx SHARE CLASSES PRODUCTTYPE ASSET CLASS CATEGORY AS CAP IS SS TR Mutual Fund Money Market Money Market Taxable Overview Portfolio Performance Commentary Literature and Distributions Characteristics Prospectuses and Tax Info Average Annual Total Returns - Net Asset Value (NAV) (%) - Before Taxes from 10.31-2015 to 12-31.2015 Cumulative Annualized As of Date YTD 1 Mo 3 Mo 1 Yr. 3 Yr. 5 Yr 10 Yr 15 Yr 20 Yr. Since Inception 10-31-2015 0.05 001 002 006 005 009 1.48 1 77 2.71 324 11-30-2015 006 001 0.02 007 0.05 0.09 1 45 1 74 269 3.23 12-31-2015 008 002 0.03 0.08 0 05 009 1 42 1 70 266 3 22 Calendar Year Total Returns (%) as of 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 Net Asset Value (NAV) 0.08 002 005 0 17 0 14 0 17 059 2 92 523 4.98 Daily Performance from 01-11-2016 to 01.20-2016 Prices YTD Total Dividend Yields Returns Factor As of Date NAV (S) NAV Change (S) NAV (%) Daily Gross Daily Net 7-Day Net 7-Day Unsub Net 7-Day Effective Yield Yield Yield Yield Yield 01-11-2016 1.00 000 0.00 0000008858 0.48 028 028 020 028 01-12-2016 1 00 000 0.00 0.000009193 050 029 0.28 020 028 01-13-2016 1.00 000 000 0.000009220 050 0.29 028 0 20 028 01-14-2016 1.00 000 000 0000009085 049 029 028 020 028 01-15-2016 1 00 0.00 000 0000009847 052 031 029 0.21 029 01-16-2016 1.00 000 000 0000009847 052 031 029 021 029 01-17-2016 1 00 0.00 0.00 0.000009847 052 0.31 030 022 0.30 01-18-2016 1.00 0 00 000 0000009847 052 031 030 022 0 30 01-19-2016 1.00 0.00 000 0000009966 052 032 031 0.23 0.31 01-20-2016 1.00 0 00 000 0000009872 0.52 031 031 023 0.31 Effective October 1, 2015, the dividend factor will contain some amount of excess capital distribution This amount will be estimated and disclosed through a monthly 19(a) notice beginning in early November 2015 Any amount that is considered excess capital is not reflected in the yield or average annual total return of the fund However, the excess Capital amount will be Considered taxable dividend income. Performance quoted represents past performance, which Is no guarantee of future results. Investment return will vary. An investor's shares, when redeemed, may be worth more or less than the original cost. Current performance may be lower or higher than what Is stated. The value of some asset -backed secunties may be particularly sensitive to changes in prevailing interest rates, and although the securities are generally supported by some form of government or private guarantee and/or insurance, there is no assurance that private guarantors or insurers will meet their obligations An Investment In money market funds Is neither Insured nor guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although money market funds seek to preserve the value of your investment at $1.00 per share, it Is possible to lose money by Investing In these funds. Although not contractually Obligated to do so, the adviser and/or certain fund service providers waived all or a portion of their fees or reimbursed the fund for certain operating expenses These voluntary waivers and reimbursements may be modified or terminated at any time, accordingly, the fund's expenses may vary (i.e , increase or decrease) during the funds fiscal year. These waivers increase income to the fund and result in a higher return to investors Total return represents the change in value of an investment after reinvesting all income and capital gains Yield quotations more closely reflect the current earnings of the fund than the total return quotation. Total returns for periods of less than one year are cumulative. Investors should carefully consider the fund's investment objectives, risks, charges and expenses before Investing. To obtain a summary prospectus or prospectus containing this and other information, contact us or view the prospectus provided on this website. Please carefully read the summary prospectus or prospectus before Investing. For additional information, including definitions of related terms and indexes. see the Financial Glossary and Benchmark Index Glossary http://www.federatedinvestors.comIFIIlmutualfundsldetailslperformance.do?fundshareid=... 1 /21 /2016 Federated Prime Obligations Fund (IS): Performance Page 2 of 2 CONTRACT NO. C35200 Please note that daily fund prices, dividend factors and yield information (collectively, the 'Pricing Information') are posted to this web page at approximately 6.30 p m ET and are updated each day that the New York Stock Exchange is open for regular trading Daily gross yields and 7 day unsubsidized net yields are updated at approximately 8.30 p m ET. Daily fund prices, dividend factors, and yield information are subject to normal quality control, validation, and verification after such posting, and prior to 10.00 a m ET the next business day, remain subject to change. Taxable Money Market Fund daily dividend factors, may include short term capital gains Please take this into consideration when using this information Federated Securities Corp , Distributor Not FDIC Insured May Lose Value No Bank Guarantee Copyright ® 2016 Federated Investors, Inc Site Map Fund Governance Privacy Policy Security Policy Contact Us Mobile Connect with us: http://www.federatedinvestors.comIFIIlmutualfundsldetailslperformance.do?fundshareid=... 1 /21 /2016 UUNTRAG { NO. L:352UU z m p ow v, a o w ro m• m& m- o 0 N w Er T N m CC zh ` _ H a N `6 'a m IV rri ev '-1 C7 a ■ 0 ■ ■ ■ i a ■ ■ C � po C Q O xF7 G� v3'! n bA ;4 c� ro m n rr T Fr 540 °c 40 N v m a c c m o 3 e C,3 3 m m e c ti' 3 p o cp m n [3 �o U2 w a C7 p 0 O G n Q � � n N +! 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C35200 TRI-PARTY AGREEMENT INSTRUMENT OF RESIGNATION, APPOINTMENT AND ACCEPTANCE, dated as of by and among the , (the "Issuer"), (the "borrower "), , a national banking association duly organized and existing under the laws of the United States of America, as Prior Trustee, Registrar, and Paying Agent ("Prior Trustee") and U.S. BANK NATIONAL ASSOCIATION, a national banking association duly organized and existing under the laws of the United States of America as Successor Trustee, Registrar, and Paying Agent ("Successor Trustee RECITALS: WHEREAS, the Issuer and Borrower appointed the Prior Trustee under various agreements listed in Exhibit A to this Instrument (the "Agreements"); WHEREAS, the Issuer and Borrower desires to appoint the Successor Trustee to succeed Prior Trustee in such capacities under the Agreements; and WHEREAS, Successor Trustee is willing to accept such appointment as Successor Trustee under the Agreements; NOW, THEREFORE, the Issuer and Borrower, Prior "Trustee and Successor Trustee, for and in consideration of the premises of other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, hereby consent and agree as follows: ARTICLE I THE PRIOR TRUSTEE SECTION 1.01 Prior Trustee hereby resigns as Trustee under the Agreements. SECTION 1.02 Prior Trustee hereby represents and warrants to the Successor Trustee that (i) no event of default or no incipient event of default, covenant or condition contained in the Agreements has been intentionally waived by the Prior Trustee or has been waived in writing delivered to the Prior Trustee by the holders of the percentage in aggregate principal amount of the Bonds required by any of the Agreements to effect any such waiver and (ii) there is no action, suit or proceeding pending or, to the best knowledge of the Prior Trustee, threatened against the Prior Trustee before any court or governmental entity arising out of any action or omission by the Prior Trustee under the Agreements. SECTION 1.03 Prior Trustee hereby assigns, transfers, delivers and confirms to Successor Trustee all right, title and interest of Prior Trustee under the Agreements and all the rights and powers of the Prior Trustee under the Agreements. Prior Trustee shall execute and deliver such further instruments and shall do such other things as Successor Trustee may reasonably require so as to more fully and certainly vest and confirm in Successor Trustee all the rights and powers hereby assigned, transferred, delivered and confirmed to Successor Trustee. CONTRACT NO. C35200 ARTICLE II THE ISSUER AND BORROWER SECTION 2.01 The Issuer and Borrower hereby accepts the resignation of Prior Trustee as Trustee, Registrar and Paying Agent under the Agreements. SECTION 2.02 The Issuer and Borrower hereby confirms that all conditions relating to the appointment of U.S. Bank National Association as Successor Trustee under the Agreements have been met by the Issuer and Borrower, and the Issuer and Borrower hereby appoints Successor Trustee under the Agreements with like effect as if originally named as Trustee in the Agreements. ARTICLE III THE SUCCESSOR TRUSTEE SECTION 3.01 Successor Trustee hereby represents and warrants to Prior Trustee and to the Issuer and Borrower that Successor Trustee is qualified to act as Trustee under the Agreements. SECTION 3.02 Successor Trustee hereby accepts its appointment as Successor Trustee under the Agreements and accepts the rights, powers, duties and obligations of Prior Trustee as Agent under the Agreements, upon the terms and conditions set forth therein, with like effect as if originally named as Trustee under the Agreements. ARTICLE IV MISCELLANEOUS SECTION 4.01 This Instrument and the resignation, appointment and acceptance effected hereby shall be effective as of the opening of business on August 1, 2013. SECTION 4.02 This Instrument shall be governed by and construed in accordance with the laws of the State of Arizona. SECTION 4.03 This Instrument may be executed in any number of counterparts each of which shall be an original, but such counterparts shall together constitute but one and the same instrument. SECTION 4.04 The persons signing this Instrument on behalf of the Issuer and Borrower, Successor Trustee and Prior Trustee are duly authorized to execute it on behalf of the each party, and each party warrants that it is authorized to execute this Instrument and to perform its duties hereunder. CONTRACT NO. C35200 IN WITNESS WHEREOF, the parties hereto have caused this Instrument of Resignation, Appointment and Acceptance to be duly executed and acknowledged all as of the day and year first above written. Issuer Prior Trustee By: Name: Title: as Prior Trustee By: Name: Title: Successor Trustee U.S. Bank National Association as Successor Trustee By: Name: Title: CONTRACT NO. C35200 EXHIBIT A (List of Indentures / Trust Agreements)