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REQUEST FOR PROPOSALS FOR PENSION FUNDING STRATEGY FOR EMPLOYEE RETIREMENT compensation may present a potential conflict of interest regarding NHA’ ability to provide unbiased advice to enter such transaction. The contingent fee arrangement creates an incentive for NHA to recommend unnecessary financing or financing that are disadvantageous to the City, or to advise the City to increase the size of the issue. This potential conflict of interest will not impair NHA’ ability to render unbiased and competent advice or to fulfill its fiduciary duty to the City. • NHA’ fees under this potential agreement may be based on hourly fees of NHA’ personnel, with the aggregate amount equaling the number of hours worked by such personnel times an agreed- upon hourly billing rate. This form of compensation presents a potential conflict of interest because it could create an incentive for NHA to recommend alternatives that would result in more hours worked. This conflict of interest will not impair NHA’ ability to render unbiased and competent advice or to fulfill its fiduciary duty to the City. • NHA’ fees under this potential agreement may be a fixed amount established at the outset of this potential agreement. The amount is usually based upon an analysis by the City and NHA of, among other things, the expected duration and complexity of the transaction and the scope of services to be performed by NHA. This form of compensation presents a potential conflict of interest because, if the transaction requires more work than originally contemplated, NHA may suffer a loss. Thus, NHA may recommend less time-consuming alternatives, or fail to do a thorough analysis of alternatives. This conflict of interest will not impair NHA’ ability to render unbiased and competent advice or to fulfill its fiduciary duty to the City. • The fee paid to NHA increases the cost of investment to the City. The increased cost occurs from compensating NHA for municipal advisory services provided. • NHA serves a wide variety of other clients that may, from time to time, have interests that could have a direct or indirect impact on the interests of another NHA client. For example, NHA serves as municipal advisor to other municipal advisory clients and, in such cases, owes a regulatory duty to such other clients just as it does to the City. These other clients may, from time to time and depending on the specific circumstances, have competing interests. In acting in the interests of its various clients, NHA could potentially face a conflict of interest arising from these competing client interests. NHA fulfills its regulatory duty and mitigates such conflicts through dealing honestly and with the utmost good faith with the City. • Gerald Craig Hill, the Managing Principal of NHA is currently serving as an outside director for the HdL Companies based in Diamond Bar, CA. HdL Companies is a software and professional services consulting company providing revenue data and collections information to local governments, potentially including NHA’s clients. HdL Companies have affiliates including, but not limited to, HdL Coren & Cone. From time to time, NHA utilizes the services of HdL Coren & Cone for its clients. NHA is mindful of this conflict of interest and fulfills its regulatory duty and mitigates such conflicts through dealing honestly and with the utmost good faith when this situation arises. • NHA does not have any affiliate that provides any advice, service, or product to or on behalf of the City that is directly or indirectly related to the municipal advisory activities to be performed by NHA. • NHA has not made any payments directly or indirectly to obtain or retain NHA’ municipal advisory business. • NHA has not received any payments from third parties to enlist NHA’ recommendation to the City of its services, any municipal securities transactions, or any municipal finance product. • NHA has not engaged in any fee-splitting arrangements involving NHA and any provider of investments or services to the City. Docusign Envelope ID: BB80A86F-2853-4F40-B02D-18F5B9DD615F