Conflicts of Interest and Other Matters Requiring Disclosures. Pursuant to Municipal Securities Rulemaking Board (“MSRB”) Rule G-42, on Duties of Non-Solicitor Municipal Advisors, Municipal Advisors are required to make certain written disclosures to clients which include, amongst other things, Conflicts of Interest and any Legal or Disciplinary events of Urban Futures, Inc. (“Urban”) and its associated persons.

The following are potential conflicts of interest to be considered.

  • Urban represents that in connection with the issuance of municipal securities, Urban may receive compensation from an Issuer or Obligated Person for services rendered, which compensation is contingent upon the successful closing of a transaction and/or is based on the size of a transaction. Consistent with the requirements of MSRB Rule G-42, Urban hereby discloses, that such contingent and/or transactional compensation may present a potential conflict of interest regarding Urban’s ability to provide unbiased advice to enter into such transaction. The contingent fee arrangement creates an incentive for Urban to recommend unnecessary financings or financings that are disadvantageous to the client, or to advise the client to increase the size of the issue. This potential conflict of interest will not impair Urban’s ability to render unbiased and competent advice or to fulfill its fiduciary duty to the client.
  • Urban fees under this potential agreement may be based on hourly fees of Urban’s 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 Urban to recommend alternatives that would result in more hours worked. This conflict of interest will not impair Urban’s ability to render unbiased and competent advice or to fulfill its fiduciary duty to its clients.
  • Urban’s fees under this potential agreement, may be a fixed amount established at the outset of the Agreement. The amount is usually based upon an analysis by the client and Urban of, among other things, the expected duration and complexity of the transaction and the Scope of Services to be performed by Urban. This form of compensation presents a potential conflict of interest because, if the transaction requires more work than originally contemplated, Urban may suffer a loss. Thus, Urban may recommend less time-consuming alternatives, or fail to do a thorough analysis of alternatives. This conflict of interest will not impair Urban’s ability to render unbiased and competent advice or to fulfill its fiduciary duty to the client.
    The fee paid to Urban increases the cost of investment to client. The increased cost occurs from compensating Urban for municipal advisory services provided.
  • Urban 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 Urban client. For example, Urban serves as municipal advisor to other municipal advisory clients and, in such cases, owes a regulatory duty to such other clients. 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, Urban could potentially face a conflict of interest arising from these competing client interests. Urban fulfills its regulatory duty and mitigates such conflicts through dealing honestly and with the utmost good faith with its clients.
  • Urban does not have any affiliate that provides any advice, service, or product to or on behalf of the client that is directly or indirectly related to the municipal advisory activities to be performed by Urban;
  • Urban has not made any payments directly or indirectly to obtain or retain its clients municipal advisory business;
  • Urban has not received any payments from third parties to enlist Urban’s recommendation to its clients of its services, any municipal securities transaction or any municipal finance product;
  • Urban has not engaged in any fee-splitting arrangements involving Urban and any provider of investments or services to its clients;
  • Urban does not have any legal or disciplinary event that is material to its clients evaluation of the municipal advisory or the integrity of its management or advisory personnel.
  • Urban does not act as principal in any of the transaction(s) related to this Agreement.
  • Randall Merritt, a Managing Principal, previously worked at Raymond James & Associates, Inc. from December 2015 until December 2023. Urban’s relationships with Raymond James and all other investment banks are conducted in an arm’s length manner, and any recommendations are independent of any prior employment or other relationships.

Legal Events and Disciplinary History. Urban does not have any legal events and disciplinary history on its Form MA and Form MA-I, which includes information about any criminal actions, regulatory actions, investigations, terminations, judgments, liens, civil judicial actions, customer complaints, arbitrations and civil litigation. Clients may electronically access Urban’s most recent Form MA and each most recent Form MA-I filed with the Commission at the following website: www.sec.gov/edgar/searchedgar/companysearch.html.

There have been no material changes to a legal or disciplinary event disclosure on any Form MA or Form MA-I filed with the SEC.