HomeMy WebLinkAboutPR 23407: ARBITRAGE REBATE COMPLIANCE SERVICES WITH HILLTOP SECURITIES ASSET MANAGEMENT, LLC City of 4
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www.PortArthurTx.gov
INTEROFFICE MEMORANDUM
Date: 10/17/2023
To: The Honorable Mayor and City Council
Through: Ron Burton, City Manager
From: Kandy Daniel, Director of Finance
RE: PR No. 23407 Approval of Contract for arbitrage rebate compliance services
with Hilltop Securities Asset Management, LLC
Introduction: Request approval for the City Manager to enter a new contract agreement for
arbitrage rebate compliance services with Hilltop Securities Asset Management, LLC for a
period of two years.
Background: The City is obligated by bond ordinances to monitor the investment earnings of
bond proceeds to determine to what extent, if any, we will be required to rebate excess
earnings to the Internal Revenue Service. The constantly changing, Treasury Department
regulations, set forth the statutory rules and exceptions used to calculate the excess earnings.
Compliance with these complex regulations requires specific expertise.
Since 1995, the City has maintained a contract with Hilltop Securities (previous name - First
Southwest)to provide arbitrage rebate services. Our relationship with Hilltop Securities
throughout the term of these contracts has been excellent. They have performed as outlined in
the contract and assisted us with rebate and in meeting the arbitrage exceptions.
Budget Impact: The contract has annual projected budgetary impact of$16, 000 and funds are
available in the Finance Department professional services account no. 001-07-015-5420-00-
10-000.
Recommendation: The attached Proposed Resolution No. 23407 authorizes the City Manager
to enter a new contract agreement for arbitrage rebate compliance services with Hilltop
Securities Asset Management, LLC for a period of two years. We recommend that the City
Council approve it as presented.
P. R. NO. 23407
KD 10/17/2023
RESOLUTION NO.
A RESOLUTION AUTHORIZING THE CITY MANAGER
TO ENTER INTO A NEW CONTRACT AGREEMENT FOR
ARBITRAGE REBATE COMPLIANCE SERVICES WITH
HILLTOP SECURITIES ASSET MANAGEMENT,LLC,FOR
A PERIOD OF TWO (2) YEARS WITH AN ANNUAL
PROJECTED BUDEGETARY IMPACT OF $16,000;
FUNDING AVAILABLE IN FINANCE DEPARTMENT
ACCOUNT #001-07-015-5420-00-10-000.
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PORT ARTHUR:
THAT the City Manager of the City of Port Arthur is hereby authorized and directed to
execute on behalf of the City of Port Arthur a contract for arbitrage rebate compliance services
between the City of Port Arthur and Hilltop Securities Asset Management, LLC, as described in
Exhibit "A"; and
THAT, even though the contract is for two years, it is still subject to the availability and
approval of funding during the annual budget approval process; and
THAT a copy of said contract is attached hereto and made a part hereof as Exhibit "A"; and,
THAT a copy of the caption of this resolution be spread upon the Minutes of the City
Council.
READ,ADOPTED,AND APPROVED, this day of October, 2023, A.D., at a
Regular Meeting of the City Council of the City of Port Arthur, Texas by the following vote:
AYES: Mayor:
Councilmembers:
NOES:
w
Thurman"Bill"Bartie, Mayor
ATTEST:
Sherri Bellard, City Secretary
APPROVED AS TO FORM:
1Y7)*(7(
Val Tizeno, Cit torney
APPROVED FOR AVAILABILIT F FUNDS:
C cL
Kandy Daniel, irector of Finance
APPROVED FOR ADMINISTRATION:
Ron Burton, City Manager
EXHIBIT "A"
Form No. 148(f);Revised 02/01/2022
AGREEMENT FOR
ARBITRAGE REBATE COMPLIANCE SERVICES
BETWEEN
CITY OF PORT ARTHUR,TEXAS
(Hereinafter Referred to as the"ISSUER")
AND
HILLTOP SECURITIES ASSET MANAGEMENT,LLC
(Hereinafter Referred to as"HSAM")
It is understood and agreed that the Issuer, in connection with the sale and delivery of certain bonds, notes, certificates, or
other tax-exempt obligations(the"Obligations"or"Bonds"),will have the need to determine to what extent,if any,it will be
required to rebate certain investment earnings (the amount of such rebate being referred to herein as the "Arbitrage
Amount") from the proceeds of the Obligations to the United States of America pursuant to the provisions of Section
148(f)(2) of the Internal Revenue Code of 1986, as amended (the "Code"). For purposes of this Agreement, the term
"Arbitrage Amount" includes payments made under the election to pay penalty in lieu of rebate for a qualified construction
issue under Section 148(f)(4)of the Code.
If it is accepted by the Issuer, this shall become the agreement(the "Agreement") between the Issuer and HSAM and will
become effective at the date of its acceptance as provided for herein below.
1. This Agreement shall apply to all issues of tax-exempt Obligations delivered subsequent to the effective date of the
rebate requirements under the Code,except for(i)issues which qualify for exceptions to the rebate requirements in
accordance with Section 148 of the Code and related Treasury regulations, or(ii) issues excluded by the Issuer in
writing in accordance with the further provisions hereof, (iii) new issues effected in a fashion whereby HSAM is
unaware of the existence of such issue, (iv) issues in which, for reasons outside the control of HSAM, HSAM is
unable to procure the necessary information required to perform such services.
Covenants of Hilltop Securities Asset Management
2. HSAM agrees to provide our professional services in determining the Arbitrage Amount with regard to the
Obligations. The Issuer will assume and pay the fee of HSAM as such fee is set out in Appendix A attached hereto.
HSAM shall not be responsible for any expenses incurred on behalf of Issuer in connection with providing such
professional services, including any costs incident to litigation, mandamus action, test case or other similar legal
actions.
3. HSAM agrees to perform the following duties in connection with providing arbitrage rebate compliance services:
a. To cooperate fully with the Issuer in reviewing the schedule of investments made by the Issuer with (i)
proceeds from the Obligations, and (ii) proceeds of other funds of the Issuer which, under Treasury
Regulations Section 1.148, or any successor regulations thereto, are subject to the rebate requirements of
the Code;
b. To perform, or cause to be performed, consistent with the Code and the regulations promulgated
thereunder,calculations to determine the Arbitrage Amount under Section 148(f)(2)of the Code;and
c. To provide a report to the Issuer specifying the Arbitrage Amount based upon the investment schedule,the
calculations of bond yield and investment yield, and other information deemed relevant by HSAM. In
undertaking to provide the services set forth in paragraph 2 and this paragraph 3, HSAM does not assume
any responsibility for any record retention requirements which the Issuer may have under the Code or other
applicable laws, it being understood that the Issuer shall remain responsible for compliance with any such
record retention requirements. HSAM shall maintain Issuer records and work product pursuant to its own
internal document retention policy.
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AR"
Covenants of the Issuer
4. In connection with the performance of the aforesaid duties,the Issuer agrees to the following:
a. The fees due to HSAM in providing arbitrage rebate compliance services shall be calculated in accordance
with Appendix A attached hereto. The fees will be payable upon delivery of the report prepared by HSAM
for each issue of Obligations during the term of this Agreement.
b. The Issuer will provide HSAM all information regarding the issuance of the Obligations and the investment
of the proceeds therefrom, and any other information necessary in connection with calculating the
Arbitrage Amount. HSAM will rely on the information supplied by the Issuer without inquiry, it being
understood that HSAM will not conduct an audit or take any other steps to verify the accuracy or
authenticity of the information provided by the Issuer.
c. The Issuer will notify HSAM in writing of the retirement, prior to the scheduled maturity, of any
Obligations included under the scope of this Agreement within 30 days of such retirement. This
notification is required to provide sufficient time to comply with Treasury Regulations Section 1.148-3(g)
which requires final payment of any Arbitrage Amount within 60 days of the final retirement of the
Obligations. In the event the Issuer fails to notify HSAM in a timely manner as provided hereinabove,
HSAM shall have no further obligation or responsibility to provide any services under this Agreement with
respect to such retired Obligations.
5. In providing the services set forth in this Agreement, it is agreed that HSAM shall not incur any liability for any
error of judgment made in good faith by a responsible officer or officers thereof and,except to the limited extent set
forth in this paragraph, shall not incur any liability for any other errors or omissions, unless it shall be proved that
such error or omission was a result of the gross negligence or willful misconduct of said officer or officers. In the
event a payment is assessed by the Internal Revenue Service due to an error by HSAM, the Issuer will be
responsible for paying the correct Arbitrage Amount and HSAM's liability shall not exceed the amount of any
penalty or interest imposed on the Arbitrage Amount as a result of such error. Additionally, it is understood and
agreed that HSAM shall incur no liability for any errors, omissions, or failure to make a timely payment in
connection with any IRS Computation Date calculations occurring prior to the effective date of the Initial
Agreement with the Issuer,even if the error is discovered after the date of HSAM's engagement.
No Coordination with Private Activity Regulations
6. The purpose of HSAM's engagement is to determine the Arbitrage Amount pursuant to Section 148(0(2) of the
Code. Sections 141-147 of the Code and the related Treasury Regulations set forth requirements with respect to the
amount of obligation proceeds that may be used for the benefit of a private person or entity. Treasury Regulations
Section 1.141-6(a) requires that allocations of expenditures of obligation proceeds for purposes of computing the
Arbitrage Amount must be the same as the allocations of expenditures used to test the private use of projects
financed with proceeds of the Obligations.
7. For purposes of calculating the Arbitrage Amount,our calculations assume that the allocation of the expenditures of
Obligation proceeds as provided to us are the same for both purposes of Sections 141-147 and Section 148 of the
Code. The scope of this engagement does not include procedures to analyze the private use limitations associated
with the Obligations.
Obligations Issued Subsequent to Initial Agreement
8. The services contracted for under this Agreement will automatically extend to any additional Obligations(including
financing lease obligations) issued during the term of this Agreement if such Obligations are subject to the rebate
requirements under Section 148(0(2) of the Code. In connection with the issuance of additional Obligations, the
Issuer agrees to the following:
a. The Issuer will notify or cause the notification, in writing, to HSAM of any tax-exempt financing
(including financing lease obligations)issued by the Issuer during any calendar year of this Agreement,and
will provide HSAM with such information regarding such Obligations as HSAM may request in connection
with its performance of the arbitrage rebate services contracted for hereunder.If such notice is not provided
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to HSAM with regard to a particular Obligation, HSAM shall have no obligation to provide any services
hereunder with respect to such Obligation.
b. At the option of the Issuer, any additional Obligations to be issued subsequent to the execution of this
Agreement may be excluded from the services provided for herein. In order to exclude an issue,the Issuer
must notify HSAM in writing of their intent to exclude any specific Obligations from the scope of this
Agreement,which exclusion shall be permanent for the full life of the Obligations;and after receipt of such
notice, HSAM shall have no obligation to provide any services under this Agreement with respect to such
excluded Obligations.
Effective Date of Agreement g t
9. This Agreement shall become effective at the date of acceptance by the Issuer as set out herein below and remain in
effect thereafter for a period of two(2)years from the date of acceptance,provided, however,that this Agreement
may be terminated with or without cause by the Issuer or HSAM upon thirty (30) days prior written notice to the
other party. In the event of such termination, it is understood and agreed that only the amounts due to HSAM for
services provided and expenses incurred to and including the date of termination will be due and payable. No
penalty will be assessed for termination of this Agreement. In the event this Agreement expires or is terminated
prior to the completion of its stated term,all records provided to HSAM with respect to the investment of monies by
the Issuer shall be returned to the Issuer as soon as practicable following written request by Issuer, provided that
such records have not been destroyed pursuant to HSAM's internal document retention policy. In addition, the
parties hereto agree that, upon termination of this Agreement, HSAM shall have no continuing obligation to the
Issuer regarding any arbitrage rebate related services contemplated herein, regardless of whether such services have
previously been undertaken,completed,or performed.
Acceptance of Agreement
10. When accepted by the Issuer in accordance with the terms hereof, it,together with Appendix A attached hereto,will
constitute the entire Agreement between the Issuer and HSAM for the purposes and the consideration herein
specified. In order for this Agreement to become effective, it must be accepted by the Issuer within sixty(60)days
of the receipt by the Issuer. After the expiration of such 60-day period, acceptance by the Issuer shall only become
effective upon delivery of written acknowledgement and reaffirmation by HSAM that the terms and conditions set
forth in this Agreement remain acceptable to HSAM.
Counterpart Signatures
11. This Agreement may be executed in two or more counterparts,each of which shall be deemed an original and all of
which together shall constitute one and the same instrument. Each Party may execute this Agreement on a facsimile
or PDF hereof. In addition, facsimile or PDF signatures of either Party shall be valid and binding,and delivery of a
facsimile or PDF signature by either Party shall constitute due execution and delivery of this Agreement.
Governing Law
12. This Agreement will be governed by and construed in accordance with the laws of the State of Texas,without regard
to its principles of conflicts of laws.
Acceptance
13. Acceptance will be indicated by returning one executed copy to HSAM. An electronic version is acceptable.
HSAM will then execute the Agreement and return a fully executed electronic version of the Agreement to the
Issuer.
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Respectfully submitted,
HILLTOP SECURITIES ASSET MANAGEMENT,LLC
By
David K.Medanich,President
Date
ISSUER'S ACCEPTANCE CLAUSE
The above and foregoing is hereby in all things accepted and approved by
(Issuer Name),on this the day of
By
Authorized Representative
Title
Printed Name
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APPENDIX A-FEES
The Obligations to be covered initially under this Agreement include all issues of tax-exempt obligations delivered subsequent to
the effective dates of the rebate requirements,under the Code,except as set forth in Section I of the Agreement.
The fee for any Obligations under this Agreement shall only be payable if a computation is required under Section 148(0(2)of
the Code. In the event that any of the Obligations fall within an exclusion to the computation requirement as defined by Section
148 of the Code or related regulations and no calculations were required by HSAM to make that determination,no fee will be
charged for such issue. For example,certain obligations are excluded from the rebate computation requirement if the proceeds
are spent within specific time periods. In the event a particular issue of Obligations fulfills the exclusion requirements of the
Code or related regulations, the specified fee will be waived by HSAM if no calculations were required to make the
determination.
HSAM's fee for arbitrage rebate services is based upon a fixed Calculation Period fee per issue. The Calculation Period fee
is charged based upon the number of Calculation Periods that proceeds exist subject to rebate from the delivery date of the
issue to the Calculation Date.
HSAM's fees are payable upon delivery of the report. The first report will be made following one Calculation Period from the
date of delivery of the Obligations and on each Calculation Date thereafter during the term of the Agreement. The fees for
computations of the Arbitrage Amount which encompass more,or less,than one Calculation Period shall be prorated to reflect
the longer,or shorter,period of work performed during that period.
The fee for each of the Obligations included in this Agreement shall be based on the table below.
Additionally,due to significant time saving efficiencies realized when investment information is submitted in an electronic
format, HSAM passes the savings to its clients by offering a 10% reduction in its fees if information is provided in a
spreadsheet or electronic text file format.
Description FEE
ANNUAL CALCULATION PERIOD FEE S 1,400
COMPREHENSIVE ARBITRAGE COMPLIANCE SERVICES INCLUDE:
• Commingled Funds Analysis&Calculations
• Spending Exception Analysis&Calculations
• Yield Restriction Analysis&Calculations
(for yield restricted Project Funds,Reserve Funds,Escrow Funds,etc.)
• Parity Reserve Fund Allocations
• Transferred Proceeds Calculations
• Universal Cap Calculations
• Debt Service Fund Calculations(including earnings test when required) INCLUDED
• Preparation of all Required IRS Paperwork for Making a Rebate Payment/Yield Reduction
Payment
• Retention of Records Provided for Arbitrage Computations
• IRS Audit Assistance
• Delivery of Rebate Calculations Each Year That Meets the Timing Requirements of the Audit
Schedule
• On-Site Meetings,as Appropriate,to Discuss Calculation Results/Subsequent Planning Items
OTHER SERVICES AVAILABLE:
IRS Refund Request—Update calculation,prepare refund request package,and assist issuer as necessary S750
in responding to subsequent IRS Information Requests
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EXPLANATION OF TERMS:
a. Bond Year:A"Bond Year"is each 1-year period selected by the issuer. The first and last bond years may be short
periods. If no bond year is selected,bonds years will end on each anniversary date of the issue and at final maturity.
b. Computation Date: A"Computation Date"is a five bond year period no longer than five years after the issue date.
Subsequent Computation Dates will be for a period not later then 5 years after the previous Computation Date and at
final maturity of the issue.
c. Calculation Period: A"Calculation Period"represents a one year period from the delivery date of the issue to the date
that is one calendar year after the delivery date, and each subsequent one-year periods thereafter. Therefore, if a
calculation is required that covers more than one Calculation Period, the Calculation Period fee is multiplied by the
number of periods contained in the calculation being performed. If a calculation includes a portion of a Calculation
Period,i.e.,if the calculation includes 1 '/2 Calculation Periods,then the base fee will be multiplied by 1.5.
d. Electronic Data Submission: The data should be provided electronically in MS Excel or ASCII text file (comma
delimited text preferred) with the date, description, dollar amount, and an activity code (if not in debit and credit
format)on the same line in the file.
e. Variable/Floating Rate Bond Issues: Special services are also required to perform the arbitrage rebate calculations
for variable rate bonds. A bond is a variable rate bond if the interest rate paid on the bond is dependent upon an
index which is subject to changes subsequent to the issuance of the bonds. The computational requirements of a
variable rate issue are more complex than those of a fixed rate issue and, accordingly, require significantly more
time to calculate. The additional complexity is primarily related to the computation of the bond yield,which must be
calculated on a "bond year" basis. Additionally, the regulations provide certain flexibility in computing the bond
yield and determining the arbitrage amount over the first IRS reporting period;consequently, increased calculations
are required to determine which bond yield calculation produces the lowest arbitrage amount.
f. Commingled Fund Allocations: By definition, a commingled fund is one that contains either proceeds of more
than one bond issue or proceeds of a bond issue and non-bond proceeds (i.e., revenues) of$25,000 or more. The
arbitrage regulations, while permitting the commingling of funds,require that the proceeds of the bond issue(s)be
"carved out" for purposes of determining the arbitrage amount. Additionally, interest earnings must be allocated to
the portion of the commingled fund that represents proceeds of the issue(s) in question. Permitted "safe-harbor"
methods(that is,methods that are outlined in the arbitrage regulations and,accordingly,cannot be questioned by the
IRS under audit),exist for allocating expenditures and interest earnings to issues in a commingled fund.HSAM uses
one of the applicable safe-harbor methods when doing these calculations.
g. Debt Service Reserve Funds: The authorizing documents for many revenue bond issues require that a separate
fund be established (the"Reserve Fund") into which either bond proceeds or revenues are deposited in an amount
equal to some designated level, such as average annual debt service on all parity bonds. This Reserve Fund is
established for the benefit of the bondholders as additional security for payment on the debt. In most cases, the
balance in the Reserve Fund remains stable throughout the life of the bond issue. Reserve Funds, whether funded
with bond proceeds or revenues,must be included in all rebate calculations.
h. Debt Service Fund Calculations: Issuers are required under the regulations to analyze the invested balances in
their debt service funds annually to determine whether the fund depletes as required during the year and is,
therefore,"bona fide"(i.e., potentially exempt from rebate in that year). It is not uncommon for surplus balances to
develop in the debt service fund that services an issuer's tax supported debt,particularly due to timing differences of
when the funds were due to be collected versus when the funds were actually collected. HSAM performs this
formal analysis of the debt service fund and,should it be determined that a surplus balance exists in the fund during
a given year, allocates the surplus balance among the various issues serviced by the fund in a manner that is
acceptable under IRS review.
i. Earnings Test for Debt Service Funds: Certain types of bond issues require an additional level of analysis for the
debt service fund, even if the fund depletes as required under the regulations and is "bona fide." For short-term,
fixed rate issues, private activity issues, and variable rate issues, the regulations require that an "earnings test" be
performed on a bona fide debt service fund to determine if the interest earnings reached$100,000 during the year.In
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cases where the earnings reach or exceed the $100,000 threshold, the entire fund (not just the surplus or residual
portion)is subject to rebate.
j. Transferred Proceeds Calculations: When a bond issue is refinanced(refunded)by another issue,special services
relating to"transferred proceeds"calculations may need to be performed. Under the regulations,when proceeds of a
refunding issue are used to retire principal of a prior issue, a pro-rata portion of the unspent proceeds of the prior
issue becomes subject to rebate and/or yield restriction as transferred proceeds of the refunding issue.The refunding
issue essentially "adopts"the unspent proceeds of the prior issue for purposes of the arbitrage calculations. These
calculations are required under the regulations to ensure that issuers continue to exercise due diligence to complete
the project(s)for which the prior bonds were issued.
k. Universal Cap: Current regulations provide an overall limitation on the amount of gross proceeds allocable to an
issue. Simply stated,the value of investments allocated to an issue cannot exceed the value of all outstanding bonds
of the issue. For example,this situation can occur if an issuer encounters significant construction delays or enters
into litigation with a contractor. It may take months or even years to resolve the problems and begin or resume
spending the bond proceeds;however,during this time the debt service payments are still being paid, including any
scheduled principal payments. Thus, it's possible for the value of the investments purchased with bond proceeds to
exceed the value of the bonds outstanding. In such cases,a"de-allocation"of proceeds may be required to comply
with the limitation rules outlined in the regulations.
1. Yield Restriction Analysis/Yield Reduction Computations: The IRS strongly encourages issuers to spend the
proceeds of each bond issue as quickly as possible to achieve the governmental purpose for which the bonds were
issued. Certain types of proceeds can qualify for a "temporary period," during which time the proceeds may be
invested at a yield higher than the yield on the bonds without jeopardizing the tax-exempt status of the issue. The
most common temporary period is the three-year temporary period for capital project proceeds.After the end of the
temporary period, the proceeds must be yield restricted or the issuer must remit the appropriate yield reduction
payment when due. HSAM performs a comprehensive yield restriction analysis when appropriate for all issues
having proceeds remaining at the end of the applicable temporary period and also calculates the amount of the yield
reduction payment due to the IRS.
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CONFLICT OF INTEREST QUESTIONNAIRE FORM CIQ
For vendor doing business with local governmental entity
This questionnaire reflects changes made to the law by H.B. 23, 84th Leg., Regular Session. OFFICE USE ONLY
This questionnaire is being filed in accordance with Chapter 176, Local Government Code, by a vendor who Date Received
has a business relationship as defined by Section 176.001(1-a) with a local governmental entity and the
vendor meets requirements under Section 176.006(a).
By law this questionnaire must be filed with the records administrator of the local governmental entity not later
than the 7th business day after the date the vendor becomes aware of facts that require the statement to be
filed. See Section 176.006(a-1), Local Government Code.
A vendor commits an offense if the vendor knowingly violates Section 176.006, Local Government Code.An
offense under this section is a misdemeanor.
J Name of vendor who has a business relationship with local governmental entity.
Hilltop Securities Asset Management, LLC
Check this box if you are filing an update to a previously filed questionnaire.(The law requires that you file an updated
completed questionnaire with the appropriate filing authority not later than the 7th business day after the date on which
you became aware that the originally filed questionnaire was incomplete or inaccurate.)
Name of local government officer about whom the information is being disclosed.
Not Applicable
Name of Officer
J Describe each employment or other business relationship with the local government officer, or a family member of the
officer,as described by Section 176.003(a)(2)(A). Also describe any family relationship with the local government officer.
Complete subparts A and B for each employment or business relationship described. Attach additional pages to this Form
CIQ as necessary.
A. Is the local government officer or a family member of the officer receiving or likely to receive taxable income,
other than investment income, from the vendor?
Yes No
B. Is the vendor receiving or likely to receive taxable income,other than investment income,from or at the direction
of the local government officer or a family member of the officer AND the taxable income is not received from the
local governmental entity?
Yes No
Describe each employment or business relationship that the vendor named in Section 1 maintains with a corporation or
other business entity with respect to which the local government officer serves as an officer or director, or holds an
ownership interest of one percent or more.
Not Applicable
Check this box if the vendor has given the local government officer or a family member of the officer one or more gifts
as described in Section 176.003(a)(2)(B), excluding gifts described in Section 176.003(a-1).
J Hilltop Securities Asset Management, LLC
By M`Vi 5/2/2023
Signature of vendor doing business with the governmental entity Date
Form provided by Texas Ethics Commission www.ethics.state.tx.us Revised 11/30/2015
Request for Taxpayer Give Form to the
Form
(Rev.October2018) Identification Number and Certification requester.Do not
Department of the Treasury send to the IRS.
Internal Revenue Service ►Go to www.irs.gov/FormW9 for instructions and the latest information.
1 Name(as shown on your income tax return).Name is required on this line;do not leave this line blank.
Hilltop Holdings,Inc.
2 Business name/disregarded entity name,if different from above
Hilltop Securities Asset Management, LLC
m3 Check appropriate box for federal tax classification of the person whose name is entered on line 1.Check only one of the 4 Exemptions(codes apply only to
m following seven boxes. certain entities,not individuals;see
0
instructions on page 3):
p ❑ Individual/sole proprietor or ❑ C Corporation ❑S Corporation ❑ Partnership ❑Trust/estate
ai single member LLC Exempt payee code(if any)
o.o
.i;`u ❑ Limited liability company.Enter the tax classification(C,--C corporation,S=S corporation,P=Partnership)►
o 2 Note:Check the appropriate box in the line above for the tax classification of the single-member owner. Do not check Exemption from FATCA reporting
.cLLC if the LLC is classified as a single-member LLC that is disregarded from the owner unless the owner of the LLC is
a another LLC that is not disregarded from the owner for U.S.federal tax purposes.Otherwise,a single-member LLC that code if any)
is disregarded from the owner should check the appropriate box for the tax classification of its owner.
d
u ❑ Other(see instructions)►
(Applies to accounts maintained outside the V.S.)
to 5 Address(number,street,and apt,or suite no.)See instructions.
Requester's name and address(optional)
con 717.N.Harwood Street,Suite 3400
6 City,state,and ZIP code
Dallas,TX 75201
7 List account number(s)here(optional)
Part I Taxpayer Identification Number(TIN)
Enter your TIN in the appropriate box.The TIN provided must match the name given on line 1 to avoid Social security number
backup withholding.For individuals,this is generally your social security number(SSN).However,for a
resident alien,sole proprietor,or disregarded entity,see the instructions for Part I,later.For other
entities,it is your employer identification number(EIN).If you do not have a number,see How to get a
TIN,later.
or
Note:If the account is in more than one name,see the instructions for line 1.Also see What Name and Employer identification number
Number To Give the Requester for guidelines on whose number to enter.
8 4 - 1I4I7I7 93 9
Part II Certification
Under penalties of perjury,I certify that:
1.The number shown on this form is my correct taxpayer identification number(or I am waiting for a number to be issued to me);and
2.1 am not subject to backup withholding because:(a)I am exempt from backup withholding,or(b)I have not been notified by the Internal Revenue
Service(IRS)that I am subject to backup withholding as a result of a failure to report all interest or dividends,or(c)the IRS has notified me that I am
no longer subject to backup withholding;and
3.I am a U.S.citizen or other U.S.person(defined below);and
4.The FATCA code(s)entered on this form(if any)indicating that I am exempt from FATCA reporting is correct.
Certification instructions.You must cross out item 2 above if you have been notified by the IRS that you are currently subject to backup withholding because
you have failed to report all interest and dividends on your tax return.For real estate transactions,item 2 does not apply.For mortgage interest paid,
acquisition or abandonment of secured property,cancellation of debt,contributions to an individual retirement arrangement(IRA),and generally,payments
other than interest and dividends,you are not required to sign the certification,but you must provide your correct TIN.See the instructions for Part II,later.
Sign Signature of ca
Here U.S.person P. 1�1 Date► I— � - Zv 23
General Instructions •Form 1099-DIV(dividends,including those from stocks or mutual
funds)
Section references are to the Internal Revenue Code unless otherwise
noted. •Form 1099-MISC(various types of income,prizes,awards,or gross
proceeds)
Future developments.For the latest information about developments •
related to Form W-9 and its instructions,such as legislation enacted Form 10ns b roke or mutual fund sales and certain other
transactions b after they were published,go to www.irs.gov/FormW9. y brokers)
•Form 1099-S(proceeds from real estate transactions)
Purpose of Form •Form 1099-K(merchant card and third party network transactions)
An individual or entity(Form W-9 requester)who is required to file an •Form 1098(home mortgage interest),1098-E(student loan interest),
information retum with the IRS must obtain your correct taxpayer 1098-T(tuition)
identification number(TIN)which may be your social security number •Form 1099-C(canceled debt)
(SSN),individual taxpayer identification number(ITIN),adoption
taxpayer identification number(ATIN),or employer identification number •Form 1099-A(acquisition or abandonment of secured property)
(EIN),to report on an information return the amount paid to you,or other Use Form W-9 only if you are a U.S.person(including a resident
amount reportable on an information return.Examples of information alien),to provide your correct TIN.
returns include,but are not limited to,the following. If you do not return Form W-9 to the requester with a TIN,you might
•Form 1099-INT(interest earned or paid) be subject to backup withholding.See What is backup withholding,
later.
Cal.No.10231X Form W-9(Rev.10-2018)