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City of Santa Ana, California Proposal for Municipal Financial Advisory Services March 12, 2020 3. Analyze existing outstanding debt to determine parity test requirements, feasibility of refunding certain outstanding series of Bonds, and debt affordability 4. Perform a comprehensive credit analysis of the City to determine the anticipated rating, preferred structure, and interest rate scale for the Bonds 5. Prepare a summary of cost of issuance 6. Independently structure the financing and present results to the City Activity 2: Assemble the Finance Team and Manage the Financing Process After an evaluation of financing options/alternatives, should it be determined that financing targets will be met through a bond issuance, UFI will begin work on the financing schedule and the implementation of the agreed upon financing strategy. Most likely, for the City's upcoming water or sewer financings, we would propose a negotiated sale. The scope of work includes, but is not limited to, the following: 1) Develop the financing timetable: UFI will coordinate with staff to develop a schedule that is consistent with the City's goals, staff availability, financing timing, and existing City Council meeting schedules. 2) Monitor the transaction process: Our role as Municipal Advisor has always included the close monitoring of the financing to ensure successful completion. In this area, UFI will coordinate all activities of the finance team, and will assist in the preparation and review of Official Statements, Trust Indentures, Installment Purchase Agreements, Escrow Agreements, Loan Term Sheets, staff reports, and all other applicable documents or presentations to the Council or rating agency. 3) Assist in the selection of additional service providers: UFI is knowledgeable of, and has worked with, most major firms which operate in the public finance realm in California. Should the City wish to go for services such as Trustee, Bond Counsel, Disclosure Counsel, or Underwriter, we are experienced and able to manage or assist staff with the selection process for these services. 4) Provide support to the City relating to financing documents: We are experienced in the delivery of presentations to City Councils and drafting of applicable staff reports. 5) Compute Sizing and Design Structure of Debt Issue: Utilizing municipal market data and bond sizing applications, UFI has the ability to prepare an independent financing structure. 6) Plan and Coordinate Presentations to Ratings Agencies and Investors: UFI is well prepared to assist in the preparation and delivery of credit presentations to rating agencies. While many factors go into the investment decision -making process, the bond rating is often the single most important factor affecting the interest cost on bonds. 7) Interest Rates and Timing: As a result of the ever -changing interest rate environment, UFI will constantly monitor market rates to ensure that financial alternatives as well as refinancing assumptions and recommendations are maximized through proper timing. As we have seen with recent market volatility, it is more important than ever to have an experienced municipal advisor to help understand and navigate financial markets. Our advisors have previous experience as investment bankers and will advocate for you on pricing day to extract every basis point of savings. Activity 3: Independently Verify Pricing Performance matters, and we care about the rates at which the City will ultimately be issuing bonds — they should be in line with the current market and other similar bond sales. To ensure the underwriter is performing in the best interest of the City, we will monitor proposed rates throughout the pre -pricing and pricing process, culminating with a post -sale book that is provided to summarize the basis for investors approving or not approving a credit, the allotment sizes, and the orders themselves. We view this as a crucial step toward maintaining strong understanding of movements in investor preferences which pays OUR 13 ® 25F-32