2009-09 Investment Advisor Selection & Agreement-PMF Asset Management LLC•
RESOLUTION 2009-09
A RESOLUTION OF THE VILLAGE COUNCIL OF THE VILLAGE OF
NORTH PALM BEACH, FLORIDA APPROVING AN AGREEMENT FOR
INVESTMENT ADVISORY SERVICES WITH PFM ASSET MANAGEMENT,
LLC AND AUTHORIZING THE MAYOR AND VILLAGE CLERK TO
EXECUTE SAME; AND PROVIDING FOR AN EFFECTIVE DATE.
WHEREAS, through the adoption of Ordinance 2008-17, the Village Council updated the
Village's Investment Policy to expressly authorize the retention of a chartered financial analyst
or a Securities and Exchange Commission registered investment advisor to invest funds on
behalfon the Village; and
WHEREAS, the Village Administration solicited proposals from firms providing such services,
and based on its evaluation of the proposals, recommended retaining PFM Asset Management,
LLC; and
WHEREAS, based on such recommendation, the Village Council determines that the retention of
PFM Asset Management is in the best interest of the Village and its residents.
NOW, THEREFORE, BE IT RESOLVED BY THE VILLAGE COUNCIL OF THE VILLAGE
OF NORTH PALM BEACH, FLORIDA as follows:
Section 1. The foregoing recitals are ratified as true and are incorporated herein.
Section 2. The Village Council hereby approves the Investment Advisory Agreement with
PFM Asset Management, LLC, a copy of which is attached hereto and incorporated hereon, and
authorizes the Mayor and Village Clerk to execute the Agreement on behalf of the Village.
Section 3. This resolution shall take effect immediately upon adoption.
PASSED AND ADOPTED THIS 12th DAY OF FEBRUARY, 2009.
(Village Seal ~~ ~;~~
MAYOR
ATTEST:"
Q___-- /~' y~
VILLAGE CLERK
INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT, entered into as of the,~~cs~-vl. day of February in the year of 2009, by
and between the Village of North Palm Beach, a municipal corporation organized and existing
under the laws of the State of Florida (hereinafter the "Client"), and PFM ASSET
MANAGEMENT LLC, a Delaware limited liability company with an office in Orlando, Florida
(hereinafter the "Advisor")
WITNESSETH
WHEREAS, the Client has funds available for investment purposes (the "Initial Funds") in
accordance with its adopted Investment Policy, as codified in Section 2-4 of the Village of North
Palm Beach Code of Ordinances (hereinafter the "Investment Policy"); and
WHEREAS, the Client desires to avail itself of the experience, sources of information,
advice, assistance and facilities available to the Advisor; to have the Advisor undertake certain
duties and responsibilities; and to perform certain services as investment advisor on behalf of the
Client, as provided herein; and
WHEREAS, the Advisor is willing to provide such services on the terms and conditions
hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and mutual covenants herein
contained, the parties hereto, intending to be legally bound, agreed as follows:
1. SERVICES OF ADVISOR.
The Client hereby engages the Advisor to serve as investment advisor under the terms of this
Agreement with respect to the Initial Funds and such other funds as the Client may from time to
time assign by written notice to the Advisor (collectively the "Managed Funds"), and the Advisor
accepts such engagement. In connection therewith, the Advisor will provide investment research
and supervision of the Client's Managed Funds investments and conduct a continuous program of
investment, evaluation and, when appropriate, sale and reinvestment of the Client's Managed
Funds assets in accordance with the Investment Policy. The Advisor shall continuously monitor
investment opportunities and evaluate investments of the Client's Funds. The Advisor shall
furnish the Client with statistical information and reports with respect to investments of the
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Managed Funds. The Advisor shall place all orders for the purchase, sale, loan or exchange of
portfolio securities for the Client's account with brokers or dealers recommended by the Advisor
and/or the Client, and to that end the Advisor is authorized as agent of the Client to give
instructions to the depository designated by the Clients as its custodian as to deliveries of
securities and payments of cash for the account of the Client. In connection with the selection of
such brokers and dealers and the placing of such orders, the Advisor is directed to seek for the
Client the most favorable execution and price, the determination of which may take into account,
subject to any applicable laws, rules and regulations, whether statistical, research and other
information or services have been or will be furnished to the Advisor by such brokers and dealers.
The depository designated by the Client (the "Custodian") shall have custody of cash, assets and
securities of the Client. The Advisor shall not take possession of or act as custodian for the cash,
securities or other assets in the Managed Funds and shall have no responsibility in connection
therewith. Authorized investments shall include only those investments which are currently
authorized by the state investment statutes, the Investment Policy and the bond covenants and as
supplemented by such other written instructions as may from time to time be provided by the
Client to the Advisor. The Advisor shall be entitled to rely upon the Client's written advice with
respect to anticipated drawdowns of Managed Funds. The Advisor will observe the instructions
of the Client with respect to broker/dealers who are approved to execute transactions involving
the Client's Managed Funds and in the absence of such instructions will engage broker/dealers
who the Advisor reasonably believes to be reputable, qualified and financially sound.
2. COMPENSATION.
(a) For services provided by the Advisor pursuant to this Agreement, the Client shall pay
the Advisor an annual fee, in monthly installments, based on the daily net assets under
management at an annual rate of 8 basis points (0.08%).
(b) The Advisor will bill the Client monthly for services performed under this Agreement,
said bill to include a statement indicating the basis upon which the fee was calculated. The Client
shall pay to the Advisor the amount payable pursuant to this Agreement not later than on the 15th
day of the month following the month during which the Advisor's statement was rendered.
(c) Assets invested by the Advisor under the terms of this Agreement may from time to
time be invested, subject to the Client's prior approval, in a money market mutual fund or local
government investment pool managed by the Advisor (either, a "Pool"), or in individual
securities. Average daily net assets subject to the fees described in this section shall not take into
account any funds invested in the Pool. Expenses of the Pool, including compensation for the
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Advisor and the Pool custodian, are described in the relevant prospectus or information statement
and are paid from the Pool.
(d) If and to the extent that the Client shall request the Advisor to render services other
than those to be rendered by the Advisor hereunder, such additional services shall be
compensated separately on terms to be agreed upon between the Advisor and the Client.
3. EXPENSE5.
(a) The Advisor shall furnish at its own expense all necessary administrative services,
office space, equipment, clerical personnel, telephone and other communication facilities,
investment advisory facilities, and executive and supervisory personnel for managing the
Managed Funds.
(b) Except as expressly provided otherwise herein, the Client shall pay all of its own
expenses including, without limitation, taxes, commissions, fees and expenses of the Client's
independent auditors and legal counsel, if any, brokerage and other expenses connected with the
execution of portfolio security transactions, insurance premiums, fees and expenses of the
Custodian of the Managed Funds including safekeeping of funds and securities and the keeping of
books and accounts.
4. REGISTERED ADVISOR; DUTY OF CARE.
The Advisor hereby represents it is a registered investment advisor under the Investment
Advisers Act of 1940. The Advisor shall immediately notify the Client if at any time during the
term of this Agreement it is not so registered or if its registration is suspended. The Advisor
agrees to perform its duties and responsibilities under this Agreement with reasonable care. The
federal securities laws impose penalties under certain circumstances on persons who are required
to act in good faith. Nothing herein shall in any way constitute a waiver or limitation of any
rights which the Client or the Advisor may have under any federal securities laws. The Client
hereby authorizes the Advisor to sign I.R.S. Form W-9 on behalf of the Client and to deliver such
form to broker-dealers or others from time to time as required in connection with securities
transactions pursuant to this Agreement.
5. ADVISOR'S OTHER CLIENTS.
The Client understands that the Advisor performs investment advisory services for various
other clients which may include investment companies, commingled trust funds and/or individual
portfolios. The Client agrees that the Advisor, in the exercise of its professional judgment, may
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give advice or take action with respect to any of its other clients which may differ from advice
given or the timing or nature of action taken with respect to the Client's Managed Funds
accounts. The Advisor shall not have any obligation to purchase, sell or exchange any security
for the Client's Managed Funds solely by reason of the fact that the Advisor, its principals,
affiliates, or employees may purchase, sell or exchange such security for the account of any other
client or for itself or its own accounts.
6. TERM.
This Agreement may be terminated by the Client in the event of any material breach of its
terms immediately upon notice by certified mail, return receipt requested. This Agreement may
be terminated by the Client at any time for any or no reason, on not less than thirty (30) days
written notice to the Advisor. The Advisor may terminate this Agreement immediately upon any
material breach of its terms by the Client, or at any time after one year upon thirty (30) days
written nonce.
7. FORCE MAJEURE.
The Advisor shall have no liability for any losses arising out of the delays in performing or
inability to perform the services which it renders under this Agreement which result from events
beyond its control, including interruption of the business activities of the Advisor or other
financial institutions due to acts of God, acts of governmental authority, acts of war, terrorism,
civil insurrection, riots, labor difficulties, or any action or inaction of any carrier or utility, or
mechanical or other malfunction.
8. DISCIPLINARY ACTIONS.
The Advisor shall promptly give notice to the Client if the Advisor shall have been found to
have violated any state or federal securities law or regulation in any criminal action or civil suit in
any state or federal court or in any disciplinary proceeding before the Securities and Exchange
Commission or any other agency or department of the United States, any registered securities
exchange, FINRA, or any regulatory authority of any State based upon the performance of
services as an investment advisor, or civil actions that are settled and require the payment of
money by the Advisor in connection with such violation or criminal actions in which there is a
plea by the Advisor of nolo contendere.
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9. INDEPENDENT CONTRACTOR.
The Advisor, its employees, officers and representatives, shall not be deemed to be
employees, agents (except as to the purchase or sale of securities described in Section 1),
partners, servants, and/or joint ventures of the Client by virtue of this Agreement or any actions or
services rendered under this Agreement.
10. BOOKS.
The Advisor shall maintain appropriate records of all its activities hereunder. The Advisor
shall provide the Client with a monthly statement showing deposits, withdrawals, purchases and
sales (or maturities} of investments, earnings received, and the value of assets held on the last
business day of the month. The statement shall be in the format and manner that is mutually
agreed upon by the Advisor and the Client.
11. THE ADVISOR'S DISCLOSURE STATEMENT.
The Advisor warrants that it has delivered to the Client, at least five business days prior to
the execution of this Agreement, the Advisor's current Securities and Exchange Commission
Form ADV, Part II (disclosure statement). The Client acknowledges receipt of such disclosure
statement at least five business days prior to the execution of this Agreement.
12. MODIFICATION.
This Agreement shall not be changed, modified, terminated or discharged in whole or in
part, except by an instrument in writing signed by both parties hereto, or their respective
successors or assigns.
13. SUCCESSORS AND ASSIGNS.
The provisions of this Agreement shall be binding on the Advisor and its respective
successors and assigns, provided, however, that the rights and obligations of the Advisor may not
be assigned without the prior written consent of the Client.
14. NOTICE.
Written notices required under this Agreement shall be sent by regular mail, certified mail,
overnight delivery or courier, and shall be deemed given when received at the parties' respective
addresses shown below. Either party must notify the other party in writing of a change in
address. .
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Client's Address
Village of North Palm Beach
501 US Highway 1,
North Palm Beach, FL 33408
Attn: Jimmy Knight, Village Manager
Advisor's Address
PFM Asset Management LLC
300 South Orange Avenue
Suite 1170
Orlando, FL 32801
Attn: Steven Alexander, Managing Director
15. APPLICABLE LAW.
With a co~y to:
Leonard G. Rubin, Esquire
Village Attorney
701 Northpoint Parkway, Suite 209
West Palm Beach, FL 33407
With copy to:
PFM Asset Management LLC
Two Logan Square, Suite 1600
18~' & Arch Streets
Philadelphia, PA 19103-2770
Attn: Controller
This Agreement shall be construed, enforced, and administered according to the laws of the
State of Florida. Any and all legal action necessary to enforce this Agreement will be held in
Palm Beach County, Florida. The Advisor and the Client agree that, should a disagreement arise
as to the terms or enforcement of any provision of this Agreement, each party will in good faith
attempt to resolve said disagreement prior to filing a lawsuit.
16. EXECUTION AND SEVERABILITY.
Each party to this Agreement represents and warrants that the person or persons signing this
Agreement on behalf of such party is authorized and empowered to sign and deliver this
Agreement for such party. The invalidity in whole or in part of any provision of this Agreement
shall not void or affect the validity of any other provision.
17. INDEMNIFICATION.
To the fullest extent permitted by law, the Advisor shall indemnify and. save harmless and
defend the Client, its officials, agents, servants and employees from and against any and all
claims, liabilities, losses and/or causes of action arising out of any wrongful act or omission
whether negligent or intentional, committed by the Advisor in the performance of this
Agreement, including those caused by or arising out of any wrongful act, omission, negligence or
default of the Advisor or its agents, servants or employees. The Advisor shall not be required to
indemnify the Client when the occurrence results solely from the wrongful acts or omissions of
the Client, its officials, agents, servants and employees. The terms of this Section shall survive
completion of all services, obligations and duties provided for in this Agreement, as well as the
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termination of this Agreement for any reason. Nothing contained herein shall create a contractual
relationship with or cause of action in favor of a third party against either the Advisor or the
Client, nor shall this Agreement be construed as a waiver of sovereign immunity beyond the
limited waiver provided in Section 768.28, Florida Statutes.
18. ENFORCEMENT COSTS
If any legal action or other proceeding is brought for the enforcement of this Agreement, or
because of an alleged dispute, beach, default or misrepresentation in connection with any
provision of this Agreement, the prevailing party shall be entitled to recover from the non-
prevailing party reasonable attorney's fees, court costs and expenses (even if not taxable as court-
awarded costs), including fees, costs and expenses incident to appeals, incurred in that action or
proceeding, in addition to any other relief to which such party may be entitled.
19. WAIVER AND PREPARATION.
Failure of a party to enforce or exercise any of its rights under this Agreement shall not be
deemed a waiver of that party's right to enforce or exercise said rights any time thereafter. This
Agreement shall not be construed more strongly against either party regardless of which party
was more responsible for its preparation.
20. INSURANCE.
The Advisor shall maintain, during the term of this Agreement, general liability
insurance in a minimum amount of $1,000,000 per occurrence and professional liability
insurance in a minimum amount of $15,000,000, combined single limit. The Advisor
will not materially alter any of the insurance policies currently in force and effect and
relied upon by the Client in executing and delivering this Agreement. Further, the
Advisor shall not reduce any coverage amounts below the minimum amounts set forth in
this Section 20.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their authorized representatives as of the date set forth in the first paragraph of this Agreement.
PFM ASSET MANAGEMENT LLC
By:
Title: Managing Director
VILLAGE OF NORTH PALM BEACH
By:
Name: William L. Manuel
Title: P1a yo r
ATTEST:
Village Clerk
APPROVED AS TO FORM AND LEGAL
SUFFICIENCY:
~~
Village Attorney
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