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HomeMy WebLinkAbout204-14 RESOLUTIONRESOLUTION NO. 204-14 A RESOLUTION TO AUTHORIZE AND ADOPT CONTINUING DISCLOSURE COMPLIANCE POLICIES AND PROCEDURES WITH RESPECT TO CITY DEBT ISSUES AND TO AUTHORIZE THE MAYOR OR DESIGNEE TO SELF-REPORT AND ACCEPT SETTLEMENT TERMS UNDER THE U.S. SECURITIES AND EXCHANGE COMMISSION'S MUNICIPALITIES CONTINUING DISCLOSURE COOPERATION INITIATIVE WHEREAS, the City has previously issued and sold and may in the future issue and sell its bonds or other evidences of indebtedness ("Bonds") in such manner as to subject the City to the requirements of U.S. Securities and Exchange Commission ("SEC") Rule 15c2-12 (the "Rule") regarding continuing disclosure of annual reports and certain specified events to investors; and WHEREAS, in order to comply with the Rule, the City has entered into and will in the future enter into certain continuing disclosure undertakings ("Undertakings"); and WHEREAS, on March 10, 2014, the SEC announced its Municipalities Continuing Disclosure Cooperation Initiative ("MCDC"), which is designed to afford favorable treatment terms to municipal issuers such as the City, as well as the underwriters of municipal obligations, with respect to any instances in the previous five years in which an issuer failed to properly disclose a failure to comply "in all material respects" with its Undertakings under the Rule; and WHEREAS, to participate in the MCDC program, issuers must self-report to the SEC possible material misstatements or omissions relating to prior compliance with their continuing disclosure obligations no later than December 1, 2014; and WHEREAS, if the SEC staff recommends an enforcement action against an issuer as a result of such self -reporting, the issuer may, without admitting or denying the findings of the SEC and without the imposition of civil penalties, agree to comply with certain recommended settlement terms, and agree to accept a settlement pursuant to which the issuer consents to the institution of a cease and desist proceeding by the SEC against it that will be a matter of public record; and WHEREAS, as part of any settlement, the issuer will likely be required to undertake to follow certain procedures, including (but not limited to) the following: (i) establishing appropriate policies and procedures and training regarding continuing disclosure undertakings; (ii) complying with existing continuing disclosure undertakings, including updating past delinquent filings within 180 days; (iii) cooperating with any subsequent investigation by the SEC, including the roles of individuals (e.g., municipal officials) or other parties involved in the offering; (iv) disclosing in a clear and conspicuous fashion the settlement terms in any official statement for an offering by the issuer within the next five years; and (v) providing the SEC with Page 2 Resolution No. 204-14 a compliance certificate regarding the foregoing on the one year anniversary of the date of the institution of the proceedings; and WHEREAS, the City may determine that it is in its best interest to self-report certain possible material misstatements or omissions relating to prior compliance, either because it is concerned the SEC may view them as a material misstatement, because an underwriter has elected to self-report such statements, or because of other valid business considerations, and the Mayor or his designee needs to be authorized to self-report and in so doing to consent to the applicable settlement terms under MCDC; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1. That in order to better assure timely compliance with the City's ongoing commitments in its continuing disclosure undertakings, the City hereby formalizes its policies and procedures regarding continuing disclosure compliance through the adoption of policies and procedures in substantially the form attached hereto as Exhibit A. Section 2. That the Mayor or his designee is hereby authorized to self-report under Municipalities Continuing Disclosure Cooperation Initiative ("MCDC") and to accept the MCDC settlement terms (including a cease and desist proceeding), if applicable, all under terms and conditions acceptable to the Mayor or his designee, if it is determined to be in the best interests of the City. PASSED and APPROVED this 18th day of November 2014. APPROVED. By Az AL . IONELD I AN, Mayor ATTEST: By: , A 4 40t- 6 . SONDRA E. SMITH, City Clerk/Treasurovomi t1,,` a0 ° os ®®®�RK TRF9:, • G • °GST Y OF s FAYETTEVILLE °�= Agenda Date: 11/18/2014 In Control: City Council Agenda Number: C. 2 City of Fayetteville, Arkansas Text File File Number: 2014-0471 Version: 1 113 West Mountain Street Fayetteville, AR 72701 479-575-8323 TDD - 479-521-1316 Status: Passed File Type: Resolution A RESOLUTION TO AUTHORIZE AND ADOPT CONTINUING DISCLOSURE COMPLIANCE POLICIES AND PROCEDURES WITH RESPECT TO CITY DEBT ISSUES AND TO AUTHORIZE THE MAYOR OR DESIGNEE TO SELF-REPORT AND ACCEPT SETTLEMENT TERMS UNDER THE U.S. SECURITIES AND EXCHANGE COMMISSION'S MUNICIPALITIES CONTINUING DISCLOSURE COOPERATION INITIATIVE WHEREAS, the City has previously issued and sold and may in the future issue and sell its bonds or other evidences of indebtedness ("Bonds") in such manner as to subject the City to the requirements of U.S. Securities and Exchange Commission ("SEC") Rule 15c2-12 (the "Rule") regarding continuing disclosure of annual reports and certain specified events to investors; and WHEREAS, in order to comply with the Rule, the City has entered into and will in the future enter into certain continuing disclosure undertakings ("Undertakings"); and WHEREAS, on March 10, 2014, the SEC announced its Municipalities Continuing Disclosure Cooperation Initiative ("MCDC"), which is designed to afford favorable treatment terms to municipal issuers such as the City, as well as the underwriters of municipal obligations, with respect to any instances in the previous five years in which an issuer failed to properly disclose a failure to comply "in all material respects" with its Undertakings under the Rule; and WHEREAS, to participate in the MCDC program, issuers must self-report to the SEC possible material misstatements or omissions relating to prior compliance with their continuing disclosure obligations no later than December 1, 2014; and WHEREAS, if the SEC staff recommends an enforcement action against an issuer as a result of such self -reporting, the issuer may, without admitting or denying the findings of the SEC and without the imposition of civil penalties, agree to comply with certain recommended settlement terms, and agree to accept a settlement pursuant to which the issuer consents to the institution of a cease and desist proceeding by the SEC against it that will be a matter of public record; and WHEREAS, as part of any settlement, the issuer will likely be required to undertake to follow certain procedures, including (but not limited to) the following: (i) establishing appropriate policies and procedures and training regarding continuing disclosure undertakings; (ii) complying with existing continuing disclosure undertakings, including updating past delinquent filings within 180 days; (iii) cooperating with any subsequent investigation by the SEC, including the roles of individuals (e.g., municipal officials) or other parties involved in the offering; (iv) disclosing in a clear and conspicuous fashion the settlement terms in any official statement for an offering by the issuer within the next five years; and (v) providing the SEC with a compliance certificate regarding the foregoing on the one year anniversary of the date of the institution of the proceedings; and WHEREAS, the City may determine that it is in its best interest to self-report certain possible material misstatements or omissions relating to prior compliance, either because it is concerned the SEC may view them as a material misstatement, because an underwriter has elected to self -report ---such statements, City of Fayetteville, Arkansas Page 1 Printed on 11/20/2014 File Number: 2014-0471 or because of other valid business considerations, and the Mayor or his designee needs to be authorized to self-report and in so doing to consent to the applicable settlement terms under MCDC; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1. That in order to better assure timely compliance with the City's ongoing commitments in its continuing disclosure undertakings, the City hereby formalizes its policies and procedures regarding continuing disclosure compliance through the adoption of policies and procedures in substantially the form attached hereto as Exhibit A. Section 2. That the Mayor or his designee is hereby authorized to self-report under Municipalities Continuing Disclosure Cooperation Initiative ("MCDC") and to accept the MCDC settlement terms (including a cease and desist proceeding), if applicable, all under terms and conditions acceptable to the Mayor or his designee, if it is determined to be in the best interests of the City. City of Fayetteville, Arkansas Page 2 Printed on 11/20/2014 City of Fayetteville Staff Review Form 2014-0471 Legistar File ID 11/18/2014 City Council Meeting Date - Agenda Item Only N/A for Non -Agenda Item Paul Becker Submitted By 10/30/2014 Submitted Date Chief Financial Officer / Finance & Internal Services Department Division / Department Action Recommendation: Approval of a Resolution to Self -Report under the Municipalities Continuing Disclosure Cooperative Initiative. This resolution will have no budget impact on the City. Budget Impact: Account Number Project Number Budgeted Item? No Does item have a cost? No Budget Adjustment Attached? No Fund Current Budget Funds Obligated Current Balance Item Cost Budget Adjustment Remaining Budget Project Title Previous Ordinance or Resolution # Original Contract Number: Comments: V20140710 Approval Date: 11,--1p,—)Li le THE CITY OF FAYETTEVILLE, ARKANSAS DEPARTMENT CORRESPONDENCE ARKANSAS www.accessfayetteville.org To: Mayor Jordan And City Council From: Paul A Becker Date: November 12, 2014 Subject: Approval of a Resolution to Self -Report under the Municipalities Continuing Disclosure Cooperative Initiative Background: On March 10, 2014 the Division of Enforcement of the Securities and Exchange Commission issued the Municipalities Continuing Disclosure Cooperative Initiative (MCDC), for issuers involved in the offer and sale of municipal securities. SEC rule 15c-12 generally prohibits any underwriter from purchasing or selling municipal securities unless the issuer has committed to providing continuing disclosures regarding the security and the issuer, including information about the City's financial condition and operating data. The underwriter and the City involved in the bond transaction have been offered to join the initiative to self-report material problems with continuing disclosure, with little guidance as to what constituted a material misstatement. In evaluating the City's last five years of bond issues, the City's underwriter found some violations that they felt should be reported to the SEC on three of the City's bond issues. The violations related to not reporting bond rating changes, insurance rating changes and the failure to link all documents and financial reports to related CUSIP numbers on the Electronic Municipal Market Access (EMMA) system. By self -reporting the underwriters limited their exposure to further sanctions. The municipalities involved have been offered the ability to self-report also. Although I believe the information that was not disclosed in the designated manner are not significant violations, it is in the City's best interest to avoid the possibility that the SEC would view them differently. It should be understood that the required financial reports were disclosed on EMMA but not associated in all places possible. The staff is also presenting to Council procedures to ensure proper disclosures to avoid any possible omission in the required disclosure requirements in the future. RECOMMENDATION: Approval of a Resolution to Self -Report under the Municipalities Continuing Disclosure Cooperative Initiative BUDGET IMPACT This resolution will have no budget impact on the City. SEC.gov 1 Municipalities Continuing Disclosure Cooperation Initiative Page 1 of 4 U>41 *.4tufilW Search SEC Documents 1 Go; Company Filings 1 More Search Options ABOUT DIVISIONS ENFORCEMENT REGULATION EDUCATION FILINGS NEWS Municipalities Continuing Disclosure Cooperation Initiative Division of Enforcement U.S. Securities and Exchange Commission I. Introduction The Municipalities Continuing Disclosure Cooperation Initiative (the "MCDC Initiative") is intended to address potentially widespread violations of the federal securities laws by municipal issuers and underwriters of municipal securities in connection with certain representations about continuing disclosures in bond offering documents. As described below, under the MCDC Initiative, the Division of Enforcement (the "Division") of the U.S. Securities and Exchange Commission (the "Commission") will recommend favorable settlement terms to issuers and obligated persons involved in the offer or sale of municipal securities (collectively, "issuers") as well as underwriters of such offerings if they self-report to the Division possible violations involving materially inaccurate statements relating to prior compliance with the continuing disclosure obligations specified in Rule 15c2-12 under the Securities Exchange Act of 1934 (the "Exchange Act"). II. Background Rule 15c2-12 generally prohibits any underwriter from purchasing or selling municipal securities unless the issuer has committed to providing continuing disclosure regarding the security and issuer, including information about its financial condition and operating data. Rule 15c2-12 also generally requires that any final official statement prepared in connection with a primary offering of municipal securities contain a description of any instances in the previous five years in which the issuer failed to comply, in all material respects, with any previous commitment to provide such continuing disclosure. The Commission may file enforcement actions under either Section 17(a) of the Securities Act of 1933 (the "Securities Act"), and/or Section 10(b) of the Exchange Act against issuers for inaccurately stating in final official statements that they have substantially complied with their prior continuing disclosure obligations. In such instances, underwriters for these bond offerings may also have violated the anti -fraud provisions to the extent they failed to exercise adequate due diligence in determining whether issuers have complied with such obligations, and as a result, failed to form a reasonable basis for believing the truthfulness of a key representation in the issuer's official statement. For instance, on July 29, 2013, the Commission charged a school district in Indiana and its underwriter with falsely stating to bond investors that the school district had been properly providing annual financial information and notices required as part of its prior bond offerings.' Without admitting or denying the Commission's findings, the school district and underwriter each consented to, among other things, an order to cease and desist from committing or causing any violations of Section 10(b) of the Exchange Act and. Rule 10b-5. The underwriter also agreed to pay disgorgement and prejudgment interest of $279,446 as well as a penalty of $300,000. The Commission has in the past emphasized that the likelihood that an issuer will abide by its continuing disclosure obligations is critical to any evaluation of its covenants. An underwriter's obligation to have a reasonable basis to believe that the key representations in a final official statement are true and accurate extends to an Issuer's representations concerning past compliance with disclosure obligations. Indeed, this provision of Rule 15c2-12 was specifically intended to serve as an incentive for issuers to comply with their undertakings to provide disclosures in the secondary market for municipal securities, and also assists underwriters and others in assessing the reliability of the issuer's disclosure representations. Moreover, the Commission has in the past stated that it believes that it is doubtful that an underwriter could form a reasonable basis for relying on the accuracy or completeness of an issuer's ongoing disclosure representations without the underwriter affirmatively inquiring as to that filing history, Questionnaire Municipalities Continuing Disclosure Cooperation Initiative Questionnaire for Self -Reporting Entities http://www. sec.gov/divisions/enforce/municipalities-continuing-disclosure... 10/23/2014 SEC.gov 1 Municipalities Continuing Disclosure Cooperation Initiative Page 2 of 4 and the underwriter may not rely solely on a written certification from an issuer that it has provided all filings or notices.° Based on available information, and as highlighted in the Commission's August 2012 Municipal Market Report, there is significant concern that many issuers have not been complying with their obligation to file continuing disclosure documents and that federal securities law violations involving false statements concerning such compliance may be widespread. III. The MCDC Initiative A. Who Should Consider Self -Reporting to the Division? To be eligible for the MCDC Initiative, an Issuer or underwriter must self-report by accurately completing the attached questionnaire and submitting it within the following applicable time periods: • For underwriters, beginning March 10, 2014 and ending at 12:00 a.m. EST on September 10, 2014; and • For issuers, beginning March 10, 2014 and ending at 5:00 p.m. EST on December 1, 2014. Information required by the questionnaire includes: • identification and contact information of the self -reporting entity; • information regarding the municipal securities offerings containing the potentially inaccurate statements; • identities of the lead underwriter, municipal advisor, bond counsel, underwriter's counsel and disclosure counsel, if any, and the primary contact person at each entity, for each such offering; • any facts that the self -reporting entity would like to provide to assist the staff in understanding the circumstances that may have led to the potentially inaccurate statement(s); and • a statement that the self -reporting entity intends to consent to the applicable settlement terms under the MCDC Initiative. Submissions may be made by email to MCDCsubmissions@sec.gov, by fax to (301) 847- 4713 or by mail to MCDC Initiative, U.S. Securities and Exchange Commission, Boston Regional Office, 33 Arch Street, Boston, MA 02110. C. Standardized Settlement Terms the Division Will Recommend To the extent an entity meets the requirements of the MCDC Initiative and the Division decides to recommend enforcement action against the entity ("eligible issuer" or "eligible underwriter"), the Division will recommend that the Commission accept a settlement which includes the terms described below° 1. Types of Proceedings and Nature of Charges For eligible issuers, the Division will recommend that the Commission accept a settlement pursuant to which the issuer consents to the institution of a cease and desist proceeding under Section 8A of the Securities Act for violation(s) of Section 17(a)(2) of the Securities Act .° The Division will recommend a settlement in which the issuer neither admits nor denies the findings of the Commission. For eligible underwriters, the Division will recommend that the Commission accept a settlement pursuant to which the underwriter consents to the institution of a cease and desist proceeding under Section 8A of the Securities Act and administrative proceedings under Section 15(b) of the Exchange Act for violation(s) of Section 17(a)(2) of the Securities Act. The Division will recommend a settlement in which the underwriter neither admits nor denies the findings of the Commission. 2. Undertakings For eligible issuers, the settlement to be recommended by the Division must include undertakings by the issuers. Specifically, as part of the settlement, the issuer must undertake to: • establish appropriate policies and procedures and training regarding continuing disclosure obligations within 180 days of the institution of the proceedings; http://www.sec.gov/divisions/enforce/municipalities-continuing-disclosure... 10/23/2014 SEC.gov 1 Municipalities Continuing Disclosure Cooperation Initiative Page 3 of 4 • comply with existing continuing disclosure undertakings, including updating past delinquent filings within 180 days of the institution of the proceedings; • cooperate with any subsequent investigation by the Division regarding the false statement(s), including the roles of individuals and/or other parties involved; • disclose in a clear and conspicuous fashion the settlement terms in any final official statement for an offering by the issuer within five years of the date of institution of the proceedings; and • provide the Commission staff with a compliance certification regarding the applicable undertakings by the issuer on the one year anniversary of the date of institution of the proceedings. For eligible underwriters, the settlement to be recommended try the Division must include undertakings by the underwriters. Specifically, as part of the settlement, the underwriter must undertake to: • retain an independent consultant, not unacceptable to the Commission staff, to conduct a compliance review and, within 180 days of the institution of proceedings, provide recommendations to the underwriter regarding the underwriter's municipal underwriting due diligence process and procedures; • within 90 days of the independent consultant's recommendations, take reasonable steps to enact such recommendations; provided that the underwriter make seek approval from the Commission staff to not adopt recommendations that the underwriter can demonstrate to be unduly burdensome; • cooperate with any subsequent Investigation by the Division regarding the false statement(s), including the roles of individuals and/or other parties involved; and • provide the Commission staff with a compliance certifications regarding the applicable undertakings by the Underwriter on the one year anniversary of the date of institution of the proceedings. 3. Civil Penalties For eligible issuers, the Division will recommend that the Commission accept a settlement in which there is no payment of any civil penalty by the Issuer. For eligible.underwriters, the Division will recommend that the Commission accept a settlement in which the underwriter consents to an order requiring payment of a civil penalty as described below: • For offerings of $30 million or less, the underwriter will be required to pay a civil penalty of $20,000 per offering containing a materially false statement; • For offerings of more than $30 million, the underwriter will be required to pay a civil penalty of $60,000 per offering containing a materially false statement; • However, no underwriter will be required to pay a total amount of civil penalties under the MCDC Initiative greater than the following: • For an underwriter with total revenue over $100 million as reported in the underwriter's Annual Audited Report - Form X -17A-5 Part III for the underwriter's fiscal year 2013: $500,000; • For an underwriter with total revenue between $20 million and $100 million as reported in the underwriter's Annual Audited Report - Form X -17A-5 Part III for the underwriter's fiscal year 2013: $250,000; and • For an underwriter with total revenue below $20 million as reported in the underwriter's Annual Audited Report - Form X -17A-5 Part III for the underwriter's fiscal year 2013: $100,000. D. No Assurances Offered with Respect to Individual Liability The MCDC Initiative covers only eligible issuers and underwriters. The Division provides no assurance that individuals associated with those entities, such as municipal officials and employees of underwriting firms, will be offered similar terms if they have engaged in violations of the federal securities laws. The Division may recommend enforcement action against such individuals and may seek remedies beyond those available through the MCDC Initiative. Assessing whether to recommend enforcement action against an individual for violations of the federal securities laws necessarily involves a case-by-case assessment of specific facts and circumstances, including evidence regarding the level of intent and other factors such as cooperation by the individual. E. No Assurances for Entities That Do Not Take Advantage of MCDC Initiative For issuers and underwriters that would be eligible for the terms of the MCDC initiative but that -do- not self-report -pursuant to the terms of the MCDC Initiative, the Division offers no assurances that it will recommend the above terms in any subsequent http://www. sec•gov/divisions/enforce/municipalities-continuing-disclosure... 10/23/2014 SEC.gov I Municipalities Continuing Disclosure Cooperation Initiative Page 4 of 4 enforcement recommendation. As noted above, assessing whether to recommend enforcement action necessarily involves a case-by-case assessment of specific facts and circumstances, but entities are cautioned that enforcement actions outside of the MCDC initiative could result in the Division or the Commission seeking remedies beyond those described in the initiative. For issuers, the Division will likely recommend and seek financial sanctions. For underwriters, the Division will likely recommend and seek financial sanctions in amounts greater than those available pursuant to the MCDC Initiative. Questions regarding the MCDC Initiative may be directed to MCDCinquiries@sec.gov. =Recommendations by the Division to the Commission are subject to approval by the Commission. =The issuers' agreement to make such disclosures is memorialized in a written undertaking frequently called a Continuing Disclosure Agreement. The Continuing Disclosure Agreement requires that issuer to file annual financial information and notices of certain material events with the Electronic Municipal Market Access, or EMMA, an electronic information repository system maintained by the Municipal Securities Rulemaking Board (MSRB), which is accessible to all investors on the Internet. In the Matter of West Clark Community Schools, AP File No. 3-15391 (July 29, 2013); In the Matter of City Securities Corporation and Randy G. Ruhl, AP File No. 3-15390 (July 29, 2013). 'See "Municipal Securities Disclosure," Securities Exchange Act Release No. 34961 (November 10, 1994), 59 FR 59590, supra notes 50-54 (November 17, 1994). See also "Amendments to Municipal. Securities Disclosure/' Securities Exchange Act Release No. 34-62184A (May 26, 2010), 75 FR 331100, supra n. 348-362 (June 10, 2010). 'The standardized settlement terms of the MCDC Initiative are only applicable to inaccurate statements concerning compliance with continuing disclosure obligations. The MCDC Initiative and the standardized settlement terms are not applicable to other material misstatements in final official statements or related communications or other misconduct. Any other potential misconduct is subject to Investigation and separate enforcement action, if appropriate. If enforcement action is taken, entities may be subject to additional remedies for that misconduct, including additional financial sanctions. e Violations of Section 17(a)(2) require a finding of negligent conduct. Modified: July 31, 2014 Site Map I Accessibility 1 Contracts I Privacy 1 Inspector General ( Agency Financial Report I Budget & Performance 1 Careers I Contact FOIA I No FEAR Act & EEO Data 1 Whistleblower Protection I Open Government 1 Plain Writing I Links I investor.gov I USA.gov http://www. sec.gov/divisions/enforce/municipalities-continuing-disclosure... 10/23/2014 U.S. SECURITIES AND EXCHANGE COMMISSION DIVISION OF ENFORCEMENT MUNICIPALITIES CONTINUING DISCLOSURE COOPERATION INITIATIVE QUESTIONNAIRE FOR SELF -REPORTING ENTITIES NOTE: The information being requested in this Questionnaire is subject to the Commission's routine uses. A list of those uses is contained in SEC Form 1662, which also contains other important information. 1. Please provide the official name of the entity that is self -reporting ("Self -Reporting Entity") pursuant to the MCDC Initiative along with contact information for the Self - Reporting Entity: Individual Contact Name: Individual Contact Title: Individual Contact telephone: Individual Contact Fax number: Individual Contact email address: Full Legal Name of Self -Reporting Entity: Mailing Address (number and street): Mailing Address (city): Mailing Address (state): Select a state... Mailing Address (zip): 2. Please identify the municipal bond offering(s) (including name of Issuer and/or Obligor, date of offering and CUSIP number) with Official Statements that may contain a materially inaccurate certification on compliance regarding prior continuing disclosure obligations (for each additional offering, attach an additional sheet or separate schedule): State: Select a state... Full Name of Issuing Entity: Full Legal Name of Obligor (if any): Full Name of Security Issue: Initial Principal Amount of Bond Issuance: Date of Offering: Date of final Official Statement (format MMDDYYYY): Nine Character CUSIP number of last maturity: 3. Please describe the role of the Self -Reporting Entity in connection with the municipal bond offerings identified in Item 2 above (select Issuer, Obligor or Underwriter): ❑ Issuer LI Obligor ❑ Underwriter 4. Please identify the lead underwriter, municipal advisor, bond counsel, underwriter's counsel and disclosure counsel, if any, and the primary contact person at each entity, for each offering identified in Item 2 above (attach additional sheets if necessary): Senior Managing Underwriting Firm: Primary Individual Contact at Underwriter: Financial Advisor: Primary Individual Contact at Financial Advisor: Bond Counsel Firm: Primary Individual Contact at Bond Counsel: Law Firm Serving as Underwriter's Counsel: Primary Individual Contact at Underwriter's Counsel: Law Firm Serving as Disclosure Counsel: Primary Individual Contact at Disclosure Counsel: 5. Please include any facts that the Self -Reporting Entity would like to provide to assist the staff of the Division of Enforcement in understanding the circumstances that may have led to the potentially inaccurate statements (attach additional sheets if necessary): 2 On behalf of [Name of Self -Reporting Entity] I hereby certify that the Self -Reporting Entity intends to consent to the applicable settlement term i under the M itiative. By: Name of Duly Title: zed Signer: EXHIBIT A CONTINUING DISCLOSURE COMPLIANCE POLICIES AND PROCEDURES The U.S. Securities and Exchange Commission (the "SEC") has strongly recommended that the issuers of municipal bonds (and other obligated parties with respect thereto) adopt written policies and procedures to assure appropriate compliance with their present and future undertakings ("Undertakings") pursuant to SEC Rule 15c2-12 (the "Rule"). These Continuing Disclosure Compliance Policies and Procedures (these "Policies and Procedures") are designed to ensure the accuracy, completeness and timeliness of posting of the annual operating data and financial statements (collectively, "Annual Reports") and notices ("Event Notices") of the occurrence of specified events ("Specified Events") which the City is obligated to provide in its Undertakings. The Rule requires that such postings be made through the Electronic Municipal Market Access ("EMMA") facility of the Municipal Securities Rulemaking Board (the "MSRB"). Assignment of Responsibility. Primary oversight responsibility for continuing disclosure compliance is assigned to the City's Finance Director and to any successor to such position. Certain specific compliance responsibilities may be assigned by the Finance Director to any other employee of the City ("Designated Representative") as deemed necessary by the Finance Director. Consultation with City Officials or Outside Professionals. The Finance Director and any Designated Representative may consult with any City officials, Bond Counsel or other municipal finance advisors or professionals that they deem appropriate to meet the requirements of these Policies and Procedures. Duties and Responsibilities. With respect to each Undertaking, the Finance Director or a Designated Representative shall: (1) Familiarize himself or herself with the content required in the Annual Report described in such Undertaking; (2) Establish a system assuring reminders of the dates by which Annual Reports are required to be delivered to any dissemination agent ("Dissemination Agent") identified in the Undertaking and the dates by which said Annual Reports are required to be posted on the EMMA system; (3) information; Prepare or cause the preparation of Annual Reports containing all required (4) Deliver or cause the delivery of Annual Reports to the Dissemination Agent by the required dates; (5) Post or confimi the posting of the Annual Reports on the EMMA system; (6) Establish a system assigning responsibility for tracking the occurrence of the Specified Events listed in such Undertaking; (7) Prepare or cause the preparation of Event Notices upon the occurrence of Specified Events containing all required information; (8) Deliver or cause the delivery of Event Notices to the Dissemination Agent by the required dates; and (9) Post or confirm the posting of the Annual Reports on the EMMA system. Training Requirements. The Finance Director will develop a training program that is designed to inform any successor Finance Director of the requirements of these Policies and Procedures and periodically to train all Designated Representatives of their respective duties and responsibilities under these Policies and Procedures. Such a training program may be developed with internal materials or those supplied by Bond Counsel or other municipal finance advisors or professionals and shall include a review of each of the City's then effective Undertakings and a review of the City's postings on the EMMA system. Revision of Policies and Procedures. The Finance Director will periodically seek the advice of City officials and Bond Counsel or such other municipal finance advisors or professionals as he or she feels appropriate to revise the terms of these Policies and Procedures. Any such revisions shall be ratified by the City Council. Recordkeeping. All documentation relating to the City's Undertakings and compliance with respect thereto shall be maintained for a period of ten years following the final maturity or redemption prior to maturity of the bonds to which such Undertakings and compliance documentation relate.