Press Alt + R to read the document text or Alt + P to download or print.
This document contains no pages.
HomeMy WebLinkAboutC24-444 G-17 Disclosure LetterCapital
Markets
0
September 9, 2024
Attn: Jill Klosterman
Eagle County
P. O. Box 850
500 Broadway
Eagle, CO 81631
Re: $20,000,000 * Certificates of Participation, Series 2024 (Bonds)
Dear Jill Klosterman:
RBC Capital Markets, LLC
Municipal Finance
1801 California Street, Suite 3850
Denver, CO 80202
Telephone: 303-595-1200
RBC Capital Markets, LLC (RBCCM) is writing the Chief Financial Officer of Eagle County (Issuer) to:
(i) Confirm the engagement of RBC Capital Markets, LLC as underwriter, and not as a financial
advisor or municipal advisor, in connection with the issuance of the above -captioned Bonds
pursuant to the Securities and Exchange Commission's Municipal Advisor Rule, and
(ii) Provide certain disclosures as required by the Municipal Securities Rulemaking Board (MSRB)
Rule G-17 as set forth in MSRB Notice 2019-20 (Nov. 8, 2019).1
As part of our underwriting services, we may provide advice concerning the structure, timing, terms, and
other similar matters concerning the issuance of the Bonds.
The following MSRB Rule G-17 (Rule G-17) conflict of interest disclosures are now broken down into
three types, including (i) dealer -specific conflicts of interest disclosures; (ii) transaction -specific
disclosures (if applicable); and (iii) standard disclosures.
I. Dealer -Specific Conflicts of Interest Disclosures
RBCCM has identified the following potential or actual material conflicts:
ORDINARY COURSE OF BUSINESS ACTIVITIES AND RELATIONSHIPS
RBCCM and its affiliates comprise a full service securities firm and a commercial bank
among other entities. RBCCM engages in municipal advisory activities, securities trading
and underwriting, corporate investment banking, asset management, retail and institutional
brokerage, and other commercial and investment banking products and services for a wide
range of corporations, municipal entities and individuals_
o The activities of RBCCM and its affiliates may include investment in, and trading of,
securities and other financial instruments for their own account or the account of customers
relating to the securities and/or financial instruments of the Issuer and/or the Obligor.
' Revised Interpretive Notice Concerning the Application of MSR13 Rule G-17 to Underwriters of Municipal
Securities (effective Mar, 31, 2021).
RBCCM and its affiliates may also communicate independent investment recommendations,
market advice or trading ideas and/or publish or express independent research views relating
the securities of the Issuer and/or the Obligor.
c, RBCCM maintains business relationships with municipal advisory firms, broker -dealers, law
firms and other transaction participants as part of its national municipal securities business
but does not utilize referral arrangements with such entities regarding municipal
underwriting, sales or trading. Further, RBCCM does not maintain any distribution
agreements with respect to municipal securities offerings.
11. Transaction -Specific Disclosures
• Disclosures Concerning Complex Municipal Securities Financing_
o Since RBCCM has not recommended a "complex municipal securities financing" to the
Issuer, additional disclosures regarding the financing structure for the Bonds are not required
to be furnished by RBCCM under Rule G-17.
III. Standard Disclosures
• Disclosures Concerning the Underwriter's Role:
o MSRB Rule G-17 requires an underwriter to deal fairly at all times with issuers, obligors and
investors.
o The underwriter's primary role is to purchase the Bonds with a view to distribution in an
arm's-length commercial transaction with the Issuer and/or the Obligor. The underwriter has
financial and other interests that differ from those of the Issuer and/or the Obligor.
o Unlike a municipal advisor, an underwriter does not have a fiduciary duty to the Issuer and/or
the Obligor under the federal securities laws and is, therefore, not required by federal law to
act in the best interests of the Issuer and/or the Obligor without regard to its own financial or
other interests.
o The Issuer and/or the Obligor may choose to engage the services of a municipal advisor with
a fiduciary obligation to represent the Issuer..'Obligor's interest in this transaction.
o The underwriter has a duty to purchase the Bonds from the Issuer and/or the Obligor at a fair
and reasonable price, but must balance that duty with its duty to sell the Bonds to investors at
prices that are fair and reasonable.
o The underwriter will review the official statement for the Bonds in accordance with, and a
part of, their respective responsibilities to investors under the federal securities laws, as
applied to the facts and circumstances of this transaction!
2 Under federal securities law, an issuer of securities has the primary responsibility for disclosure to investors. The
review of the official statement by the underwriters is solely for purposes of satisfying the underwriters' obligations
tinder the federal securities laws and such review should not be construed by an issuer as a guarantee of the accuracy
or completeness of the information in the official statement.
• Disclosures Concerning the Underwriter's Compensation:
The underwriter will be compensated by a fee and/or an underwriting discount that will be set
forth in the bond purchase agreement to be negotiated and entered into in connection with the
issuance of the Bonds. Payment or receipt of the underwriting fee or discount will be contingent
on the closing of the transaction and the amount of the fee or discount may be based, in whole or
in part, on a percentage of the principal amount of the Bonds. While this form of compensation is
customary in the municipal securities market, it presents a conflict of interest since the
underwriter may have an incentive to recommend to the Issuer and/or the Obligor a transaction
that is unnecessary or to recommend that the size of the transaction be larger than is necessary.
If you or any other Issuer and/or Obligor officials have any questions or concerns about the engagement
of RBCCM or these disclosures, please make those questions or concerns known immediately to the
undersigned. In addition, you should consult with the Issuer and/or the Obligor's own financial and/or
municipal, legal, accounting, tax and other advisors, as applicable, to the extent you deem appropriate.
This engagement is preliminary, non -binding and may be terminated at any time without penalty or
liability for costs incurred by the underwriter.
Please note that nothing in this letter should be viewed as a commitment by the underwriters to purchase
or sell all the Bonds and any such commitment will only exist upon the execution of any bond purchase
agreement or similar agreement and then only in accordance with the terms and conditions thereof.
You have been identified by the Issuer as a primary contact for the Issuer receipt of these disclosures, that
you are not a party to any disclosed conflict of interest relating to the subject transaction. If our
understanding is incorrect, please notify the undersigned immediately.
Please sign and return the enclosed copy of this letter to me via PDF or to the address set forth herein.
Depending on the structure of the transaction that the issuer decides to pursue, or if additional actual or
potential material conflicts are identified, we may be required to send you additional disclosures
regarding the material financial characteristics and risks of such transaction and/or describing those
conflicts. At that time, we also will seek your acknowledgement of receipt of any such additional
disclosures.
We look forward to working with you in connection with the issuance of the Bonds. Thank you.
Sincerely,
Dan O'Connell, Managing Director
RBC CAPITAL MARKETS, LLC
Acknowledgement to G-17 Disclosure Letter:
Aef Q�
c��t11rD��� C ON►�1'hJ1
EAGLE COUNTY
Date: ��'� •��