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CBIZ Valuation Group, LLC
CBIZ Valuation Group, LLC TITLE PAGE City of South Miami RFP – Inventory and Valuation Services Opening Date: July 11, 2012 Proposing Firm CBIZ Valuation Group, LLC 4851 LBJ Freeway, 8th Floor Dallas, TX 75244 (262) 677-1838 (262) 677-2130 (fax) Contact: Dirk Young – Senior Manager (517) 627-5237 (direct) dyoung@cbiz.com TABLE OF CONTENTS Letter of Interest ............................................................................................................ 1 Qualifications and Experience ..................................................................................... 2 Similar Projects ............................................................................................................. 3 References ..................................................................................................................... 3 Scope of Project ............................................................................................................ 6 Invoicing and Authorization ....................................................................................... 11 Terms and Conditions ................................................................................................ 12 Attachments Attachment # 3 - No Conflict of Interest/Non Collusion Affidavit ............................ 19 Attachment # 1 – Public Entity Crimes and Conflicts of Interest Affidavit ............. 22 Attachment # 2 – Drug Free Workplace Form ........................................................... 25 Professional Qualifications – additional staff ........................................................... 27 Insurance Documents ................................................................................................. 28 Price Proposal Sheet .................................................................................................. 31 4851 LBJ Freeway, 8th Floor Dallas, TX 75244 Ph: 262.677.1838 F: 262-677-2130 CBIZ is the leading provider of integrated business services and products to Business America www.cbizvaluation.com CBIZ Valuation Group, LLC Letter of Interest July 9, 2012 Ms. Maria M. Menendez City Clerk City of South Miami City Hall 6130 Sunset Drive South Miami, FL 33143 Dear Ms. Menendez: Pursuant to your request, we are pleased to provide our recommendations and proposal to the City of South Miami (City) to provide our professional inventory and valuation services to meet your GASB 34 reporting requirements. We have received all RFP information and addenda (if any) and are committed to provide the work within the designated timeframe outlined in the RFP packet. As you review our submission, we encourage you to consider the following benefits that CBIZ Valuation Group, LLC (“CVG”) offers the City: A customized solution for your reporting requirements: We understand that the City’s property valuation needs are unique. We will take time to understand your specific requirements and manage this engagement to address those needs. A stable business partner: A business relationship with CVG offers a stable, long-term business partnership. We offer the financial and technical resources of CBIZ (NYSE: CBZ), a $750 million national professional services company, providing a comprehensive range of business services, products and solutions that help our clients grow and succeed. An exceptional customer service experience: We endeavor to provide superior client service and build long-term client relationships by providing services that will result in a seamless solution that benefits the City. The undersigned is authorized to make representation for the firm. We would like to thank you for giving us the opportunity to provide our recommendations and look forward to being of service to the City of South Miami. Sincerely, CBIZ Valuation Group, LLC Dirk W. Young Senior Manager Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 2 Qualifications and Experience CBIZ Valuation Group is one of the largest full-service valuation firms in the United States. We excel as a premier full-service valuation advisory firm specializing in property valuation services, business and tangible asset valuation, financial advisory and litigation support services. We have successfully planned, managed and executed engagements for a wide array of clients across the country, including intergovernmental risk consortiums, local units of governmental, educational and religious institutions, historical/ornate properties and some of the nation’s largest companies. CBIZ Valuation Group, LLC is part of the CBIZ, Inc. (NYSE:CBZ) family of companies. We possess the financial and technical resources of CBIZ, Inc., a $750 million, publicly traded company. CBIZ, with offices in major cities throughout the country, is one of the nation’s leading providers of outsourced business services and a wide range of consulting services. A few of the characteristics of CBIZ include the following: One of the largest valuation firms in the U.S. Over 140 offices and 6,000 employees nationwide Over 80,000 clients Publicly traded on the NYSE (CBZ) To learn more about the CBIZ family of companies, please visit www.cbiz.com. To learn more about our corporate governance and audit and Sarbanes Oxley compliance, please visit http://phx.corporate-ir.net/phoenix.zhtml?c=73481&p=irol-govHighlights. CVG has been providing fixed asset inventory and valuation and data collection services nationally for more than thirty years. Our Capital Asset Practice has worked with hundreds of clients of all sizes providing our services to meet our clients’ accounting and insurance placement needs. We offer the City unparalleled customer service through our team of skilled professional consultants and technology platforms. This focus enables us to set and attain the highest levels of customer satisfaction for the City. Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 3 Similar Engagements CBIZ Valuation Group’s Capital Asset Practice has provided the following similar engagements for other clients: City of La Porte, IN – In the summer of 2011, CVG performed fixed asset inventory and insurance appraisal services on all city owned property. The city’s records were not meeting GASB 34 requirements and the insurance agent had concerns with stated values. Using a $1,000 cut-off threshold a complete inventory, asset tagging and costing was conducted and reconciliation to the existing property record was provided. The work was performed within the 90 day delivery window and was delivered under the city’s budget of $30,000. The final reports have helped make the city compliant for GASB 34 requirements and the agent and underwriters are very pleased with the supportable values established. Village of Rockaway, NY – CVG performs fixed asset inventory and insurance appraisal services for the City. Every two years we provide a site visit inventory and appraisal service and then provide a desktop update service for years in between site visits. We have delivered reports on time and within budget. City of Meriden, CT – CVG has provided site visit fixed asset inventory and valuation services for accounting and insurance purposes. Our last onsite inventory was done in 2011 and we have provided desktop updates since then. Projects were delivered on schedule and within budget. References We have included three references of clients to whom we have provided similar service to. We encourage you to contact these clients to discuss their experience working with our firm. Teresa Ludlow – City Clerk City of La Porte, IN (219) 362-9512 tludlow@cityoflaporte.com Ms. Barbara Cutler – Deputy Village Treasurer Village of East Rockaway, NY (516) 887-6300 Barbara@villageofeastrocckaway.org Agnes Puzio – Accountant City of Meriden, CT (203) 630-4143 apuzio@ci.meriden.ct.us Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 4 Engagement Team The following individuals will be actively involved in this engagement providing fieldwork inventories, costing of assets, report development and quality control review. Additional resumes of employees who may also be involved have been included in the attachment section of this proposal. Kory Dogs Director Mr. Dogs is a Director for CBIZ Valuation Group’s Capital Asset Practice. With over 18 years of hands-on experience in the insurance appraisal industry, Mr. Dogs has managed and served on hundreds of appraisal engagements across the country. He is fully versed in the valuation of buildings, machinery and equipment, improvements, infrastructure and land parcels, and has provided insurance appraisal services on a variety of properties to assist clients with their insurance reporting needs. Prior to joining CBIZ Valuation Group, Mr. Dogs was a managing partner for a regional valuation firm where his responsibilities included contract management, project planning and management, asset valuation, building appraisals, report preparation and review and staff training. Prior to that, he served as vice president of a national valuation firm’s asset management division where he oversaw the development and enhancement of appraisal related software packages and developed various valuation models pertaining to the valuation of buildings, contents, site improvements and infrastructure. Mr. Dogs earned a bachelor of arts degree with a concentration in international business from Cardinal Stritch College in Milwaukee, Wisconsin. He is a member of the following professional affiliations: ASBO (Association of School Business Officials), GFOA (Government Finance Officers Association), PRIMA (Public Risk Management Association) and AGRIP (Association of Governmental Risk Pools). David Werch, ASA Director Mr. Werch is a Director with CBIZ Valuation Group’s Capital Asset Practice. Mr. Werch has over 17 years experience in the valuation industry, both as a field appraiser and in business development. He is fully versed in the valuation of machinery and equipment, buildings and land improvements, having previously served large risk pooling groups, State properties, water and sewer utilities, college and universities and the health care industry. Prior to joining CBIZ Valuation Group, Mr. Werch was employed by a national property valuation firm where he began as a senior manager and then became managing principal, responsible for growing a newly created regional practice, which he started. Mr. Werch earned a Bachelor of Business Administration degree in real estate from Baylor University. He is a member of the American Society of Appraisers and holds the designation of Accredited Senior Appraiser (ASA) in the discipline of Machinery and Technical Specialties/Machinery and Equipment. He is also a general appraiser trainee with the Texas Appraiser Licensing and Certification Board. Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 5 Brian Roe Director Mr. Roe is a seasoned professional with over 25 years experience in providing consultation and valuation advisory services for purposes of audit compliance, fixed asset management, insurance, and regulatory compliance, including the real estate and equipment related to schools, universities, hospitals, nursing homes, water and wastewater utilities, municipalities, park districts, and infrastructures. Clients include healthcare, educational districts, private schools, and governments at all levels including special districts, and insurance consulting firms. Mr. Roe comes to CBIZ Valuation Group from American Appraisal, where he was a Senior Managing Director and Vice President for the Fixed Asset Management & Insurance Solutions (“FAMIS”) group. He was also previously President and Director of Professional Services for Assetlink, Inc. He is a member of various professional groups including Association of School Business Officials International (ASBO), Government Finance Officers Association (GFOA), Risk Management Society (RIMS), Public Risk Management Association (PRIMA), and University Risk Management and Insurance Association (URMIA). Brian Johnston Senior Consultant Mr. Johnston is a senior consultant in the Capital Asset Practice of CBIZ Valuation Group. His responsibilities include field data collection, data processing, asset valuation, data review, project management and report compilation. Prior to joining CBIZ Valuation Group, Mr. Johnston was a fixed asset appraiser with MAXIMUS. As a fixed asset appraiser he was responsible for the valuation of buildings, machinery and equipment for municipalities throughout the country. Mr. Johnston earned a bachelor of arts degree with concentrations in management and microeconomics from Oswego State University in Oswego, New York. These gentlemen will utilize additional professional resources as needed To the best of our knowledge, none of the individuals who will work on this engagement have (a) any relationship with any Commission member, his/her spouse, or family; (b) any relationship with any business or entity owned by a Commission member or their family or in which a Commission member or their family has or had an interest; nor do they have (c) any other information concerning any relationship with a Commission member which might be relevant to the Commission’s consideration. Taken collectively, the experience and credentials of our firm allow us to appreciate and approach valuations as both an art and a science. We will dedicate the time and expertise needed to understand the City’s requirements and expectations and endeavor to surpass them as we have with the clients we currently serve. Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 6 Scope of Services The City of South Miami wishes to engage a firm for a five (5) year agreement for the purposes of providing inventory and valuation services to conform to the requirements of GASB 34 as it pertains to reporting requirements and depreciation. The appraisal reports and services are to consist of on-site consultation, data collection, inventory, valuation and cost analysis of the fixed assets of the City of South Miami for the purpose of preparing a tabulated schedule of fixed assets including a depreciation study related to actual or estimated year of acquisition and acquisition cost. In addition, an opinion of the current insurance values of the buildings and equipment will be provided. The purpose of the proposed engagement is to provide professional valuation consulting services and develop data the City can utilize to address: Capital Asset Reporting: Prepare reports that can be utilized by the City in its effort to assist with meeting GASB-34 and GAAP reporting requirements. (We encourage the City to share this proposal with its independent auditor to ensure the proposed scope and methodology will be consistent with the City’s property cost accounting policies.) Property Insurance Reporting: Prepare reports to be utilized by the City to assist in establishing insurable values and assisting with insurance placement and proof of loss documentation as they relate to the property insurance reporting requirements set forth by the City’s underwriters. Proposed Engagement Schedule Upon receipt of an executed contract CVG will work the City to establish a timetable for the completion of the engagement. The City’s fiscal year runs October 1st to September 30th. Each fiscal year and through the term of the five (5) year agreement, CVG will secure all the requested information to perform the appraisal and provide an annual final report within six (6) weeks from the start date which will not be any later than November 1st of each year. The final report will be delivered no later than December 15th of each fiscal year. The City will provide access and cooperate with CVG to enable CVG to secure the required information in a timely manner. Please note that delays in obtaining the information requested in the proposal and the engagement management plan will impact the delivery of draft and final reports. Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 7 Asset Inclusions The identified fixed assets are located at various sites identified by the City in the Property Schedule, referenced in Exhibit #2 “Fixed Asset Inventory and Reconciliation Report” that was provided as part of the RFP packet. The following asset classifications will be included in the scope of the engagement: Land at $1 and above Land Improvements at $25,000 and above Machinery and Equipment, to include vehicles, at the threshold of $5,000 for GASB 34 purposes and $1,000 and above for property control Infrastructure at $250,000 and above Intangible Assets: $25,000 and above; 3 years life expectancy and above Engagement Methodology Buildings: Buildings/structures in the City will be valued as a unit-in-place for cost accounting and insurance valuation purposes reflecting specific data elements relating to dates of construction or acquisition, original cost allocation, square footage, useful life, and reproduction cost new. As applicable, buildings will be physically inspected and basic construction components analyzed (general construction, foundation, framing, roofing ceiling, exterior/interior walls and building services). Each building will be photographed and additional insurance underwriting data will be collected including, but not limited to, ISO construction classification, gross square footage, alarm systems, and occupancy and use. Land Improvements: As applicable, land improvements (outdoor lighting, fencing, signage, flagpoles, playground equipment, parking lots, sidewalks, curbs, retaining walls, etc.) will be physically inspected and recorded. Equipment and Furnishings: These assets will be physically inventoried using our data collection tools and proprietary data collection software application. This approach will help to ensure the data collected is uniform, and supportable, while providing subsequent flexible report options. It is imperative that the City provide CVG with their most recent fixed asset ledger in Excel format prior to the start of the site visit to include all listings of assets at and above the $1,000 cut-off threshold. Assets with an estimated unit acquisition cost greater than $1,000 ($5,000 and above for accounting purposes and $1,000 and above for property control purposes) will be inventoried and valued individually. As available, we will capture the following information for these assets: location, department, description, manufacturer, model, serial number, acquisition date (estimated or actual), acquisition cost (estimated or actual), replacement cost, accumulated depreciation, estimated useful life and asset/tag number. Barcode tags will be uniformly applied to all applicable capitalized assets that do not already have an asset tag. Vehicles will not be tagged. Assets that fall below the inventory threshold such as furniture will be grouped and valued in aggregate for insurance reporting purposes. Land & Capital Projects: Cost and acquisition dates for land and capital projects will be incorporated based on information provided by the City. Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 8 Infrastructure: City owned infrastructure valued at $250,000 and above will be included. Cost and acquisition dates will be incorporated based on information provided by the City. Intangible Assets: Intangible assets valued at $25,000 and above and having a 3 years life expectance and above will be incorporated by utilizing information provided by the City. City Supplied Information: Certain information will be included in our report based upon information provided by the City. We will provide a preformatted Excel spreadsheet (contained in the engagement management plan) that can be utilized by the City to report these assets. The assets typically provided in this format include laptop computers, licensed vehicles, and portable communications equipment. Due to the mobile nature of these assets, we will not physically inventory assets in these categories. For inclusion in our reports, City-supplied information must be provided in the electronic format found in the engagement management plan within two weeks of the completion of the field study. If this information is not readily available, CVG can manually add it to the database for an additional fee. CVG reserves the right to issue reports if City-supplied data is not provided in a timely fashion. Any changes to reports involving City-supplied data after issuance will be subject to an additional processing charge. Reconciliation to Existing Data: CBIZ will attempt to reconcile our findings to your existing fixed asset register. In order to accomplish this, the City will be required to provide the existing register with a cost balance that matches their last fixed reporting. The data should include the specific: acquisition dates, costs, descriptions and useful lives for individual items. If the City cannot provide this documentation and requires CBIZ to recreate it, additional fees apply. Engagement Exclusions Consulting engagement exclusions are defined as software, records, drawings, consumables, stores, spare parts, fine arts, property not located in City facilities during the fieldwork portion of the engagement and third party property. City Participation CVG will provide the City with an engagement management plan outlining required City participation. In order to ensure that this engagement is completed in a timely manner, we request that the following be provided by the City prior to starting the fieldwork portion of the engagement: A primary contact for this engagement. A primary contact that can provide unrestricted access for each building. Copies of the most recent valuation report, CAFR and capital project schedule. Copy of the most recent property ledger in Excel format Listing or electronic data file of capital projects. Applicable security access badges and or documents needed to access facilities. Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 9 Valuation Methodology Original/Acquisition Cost: The amount of money originally paid to acquire an asset. It generally includes costs such as transportation, set-up charges, taxes, engineering and architectural fees. Replacement Cost New (RCN): As applicable to insurance valuations, it is the cost required to produce a property of like kind and materials at one time in accordance with current market prices for materials, labor and manufactured equipment, contractors overhead, profit and fees, but without provisions for overtime or bonuses for labor and premiums for materials. Costing Methodology Our valuation will utilize various techniques to develop cost conclusions. The sources may include the use of proprietary and third party software, proprietary databases, technical pricing subscriptions, various publications and City-supplied information (purchase orders, capital project costs, financial statements, etc.). We will determine acquisition cost utilizing the following costing methods: Direct Costing: Where practical, we will match asset costs based on recorded information provided by the City. Standard Costing: Costs not readily determined through the use of City-supplied information will receive an estimated cost based on a “standard cost” (a known average installed cost for a like unit, estimating acquisition date). Normal Costing: Where neither direct nor standard costing can be utilized to determine acquisition cost, it will be estimated based on current cost of reproduction new, indexed by a reciprocal factor of the price increase from the estimated date of acquisition to the date of valuation. Depreciation Methodology Straight-Line Method: The method of calculating deprecation by dividing the cost, less salvage, by the number of fiscal periods of useful life. First-of-the-Month (Full Month) Convention: Assets are treated as being place into service on the first day of the month they are acquired, even if they were actually purchased after the first of the month. For additions, depreciation is calculated for a full month in the month the asset was acquired. For disposals, no depreciation is calculated in the month of disposition, rather it is calculated through the last day of the month prior to disposal. Different depreciation methods or conventions are subject to an additional charge. Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 10 Deliverables Assuming the City has provided all requested/required data in a timely manner, we will provide an electronic copy of the preliminary findings to the City for review within 6 weeks of the completion of the field study. Preliminary reports will consist of our standard Accounting Reports and will be provided in an Adobe Acrobat format. Upon acceptance of the preliminary findings, we will provide final reports to the City. One (1) hard copy bound report and one (1) CD-Rom containing electronic versions of the reports and Excel data will be provided to the City. The reports will include the following: Transmittal Letter Accounting Summary Reports Accounting Detail Reports* Depreciation Reports Insurance Summary Reports Insurance Detail Reports* Excel Database* *Denotes reports that will be provided in electronic format only. We encourage the City to review the all reports with its independent auditor. An electronic copy of a sample report may be obtained by e-mailing kjaeger@cbiz.com Barcode Tags Barcode tags needed for the initial inventory will be included in our fees. If the City requires additional barcode tags after the project is completed, CVG can provide tags at our standard rate of $200 per 1,000 tags. Orders for additional tags will be billed directly to the City. Insurance Documents Upon acceptance by the City to provide these services, CVG will submit required insurance documents meeting or surpassing the limits for each type of insurance listed in the RFP packet. Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 11 Invoicing and Authorization As directed in the RFP, our Price Proposal Sheet has been attached to this proposal listing our fees for each year of the 5 year project. The City will be invoiced directly for the services being offered. Our fee quote incorporates an expected telephone conversation with your auditors (up to two hours in length) upon issuance of our report. Any subsequent meetings/conversations or other services requested after that time, including activities and expenses referred to in the Terms and Conditions found in the Appendices will be billed separately to the City at our normal hourly rates and in accordance with our normal expense practices. Fees for any changes requested after final reports have been issued will be subject to charge at our standard hourly rates plus any applicable expenses and will be billed separately to the City. Any optional services selected will be billed directly to the City. All invoices are due upon receipt. You may indicate the acceptance of our proposed services by initialing executing the signature block and returning a copy of the agreement to the attention of the undersigned via fax at (262) 677-2130. Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 12 Client Acceptance We authorize CBIZ to distribute electronic copies of the City's preliminary and final reports to our independent auditor. _________ (initial here) Auditor Name: ______________________________ Phone: ____________________________________ E-mail Address: _____________________________ I have read the terms of this agreement and hereby authorize this assignment. ACCEPTED this _________ day of , 2012 Client: City of South Miami By: Printed Name: Title: The fees for the professional services outlined within this agreement shall remain in effect for a period not greater than 60 days. Please return the signature page to: CBIZ Valuation Group, LLC Attn: Jose Chac 4851 LBJ Freeway, 8th Floor Dallas, TX 75244 Phone: 800.253.4453 Fax: 262.677.2130 Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 13 Terms and Conditions The following are our standard Terms and Conditions. Upon acceptance by the City to provide these services, CBIZ Valuation Group will work with the City to arrive at mutually agreeable terms and conditions. The terms and conditions of this engagement with CBIZ Valuation Group, LLC (“CBIZ”) are subject to and governed by the following Terms and Conditions and other terms, assumptions and conditions contained in the engagement letter. INDEMNIFICATION The Company shall indemnify and hold harmless CBIZ and its personnel from and against any causes of action, damages (whether compensatory, consequential, special, indirect, incidental, punitive, exemplary, or of any other type or nature), costs and expenses (including, without limitation, reasonable attorneys’ fees and the reasonable time and expenses of CBIZ’s personnel involved) brought against or involving CBIZ at any time and in any way arising out of or relating to CBIZ’s services under this engagement, except to the extent judicially determined to have resulted from the bad faith, gross negligence, or willful or intentional misconduct of CBIZ’s personnel. This provision shall survive the termination of this agreement for any reason, and shall apply to the fullest extent of the law, whether in contract, tort, or otherwise. INDEMNIFICATION PROCEDURES If any action or proceeding (any of the foregoing being a “Claim”) is threatened or commenced by any third party against CBIZ that Company is obligated to defend or indemnify under this Agreement, then written notice thereof shall be given to Company as promptly as practicable. After such notice and only so long as CBIZ’s and the Company’s interests with respect to the claim remain consistent, no conflict exists, and, in controlling the defense, CBIZ’s insurance is not voided or otherwise compromised in any way, Company shall be entitled, if it so elects in writing within ten days after receipt of such notice, to take control of the defense and investigation of such Claim and to employ and engage attorneys to handle and defend the same, at Company’s sole cost and expense, with the approval of CBIZ, which approval shall not be unreasonably withheld. CBIZ shall cooperate in all reasonable respects with Company and its attorneys in the investigation, trial and defense of such Claim and any appeal arising therefrom; provided, however, that CBIZ may, at its own cost and expense, participate, through its attorneys or otherwise, in such investigation, trial and defense of such Claim and any appeal arising therefrom. Company shall enter into no settlement of a Claim that involves a remedy other than the payment of money by Company without the prior consent of CBIZ. After notice by Company to CBIZ of its election to assume full control of the defense of any such Claim, and CBIZ’s approval of selected counsel, Company shall not be liable to CBIZ for any legal expenses incurred thereafter by CBIZ in connection with the defense of that Claim. If Company does not assume full control over the defense of a Claim, then Company may participate in such defense, at its sole cost and expense, and CBIZ shall have the right Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 14 to defend the Claim in such manner as it may deem appropriate, at the cost and expense of Company. LIMITATION ON DAMAGES The Company agrees that CBIZ and its personnel shall not be liable to the Company for any claims, liabilities, causes of action, losses, damages (whether compensatory, consequential, special, indirect, incidental, punitive, exemplary, or of any other type or nature), costs and expenses (including, but not limited to attorneys’ fees) in any way arising out of this engagement in any amount greater than the total amount of fees paid by the Company to CBIZ, except to the extent finally and judicially determined to have been the result of bad faith, gross negligence, or intentional or willful misconduct of CBIZ. This provision shall survive the termination of this agreement for any reason, and shall apply to the fullest extent of the law, whether in contract, statute, tort, or otherwise. LIMITATION ON DISTRIBUTION AND USE The report, the final estimate of value, and the prospective financial analyses (collectively, as used in this paragraph, the “CBIZ Work Product”) included therein are intended solely for the information of the person or persons to whom they are addressed and solely for the purposes stated; they should not be relied upon for any other purpose, and no party other than the Company may rely on them for any purpose whatsoever. Neither the valuation report, its contents, nor any reference to the appraiser or CBIZ may be referred to or quoted in any registration statement, prospectus, offering memorandum, sales brochure, other appraisal, loan or other agreement or document given to third parties. In addition, except as set forth in the report, our analysis and report are not intended for general circulation or publication, nor are they to be reproduced or distributed to third parties. Notwithstanding the foregoing, if the Company desires to distribute or use the CBIZ Work Product in any way not expressly contemplated by these Terms and Conditions or the Agreement, including, without limitation and by way of example, reference to CBIZ by name or inclusion of any portion of the CBIZ Work Product in any regulatory filing, CBIZ, at our sole discretion, may permit Company to do so for a fee commensurate to the additional risk associated with such distribution or use. As required by new U.S. Treasury rules, we inform you that, unless expressly stated otherwise, any U.S. federal tax advice contained in this letter, including attachments, is not intended or written to be used, and cannot be used, by any person for the purpose of avoiding any penalties that may be imposed by the Internal Revenue Service. NOT A FAIRNESS OPINION Neither our opinion nor our report are to be construed as an opinion of the fairness of an actual or proposed transaction, a solvency opinion, or an investment recommendation, but, instead, are the expression of our determination of the fair value between a hypothetical willing buyer and a hypothetical willing seller in an assumed transaction on an assumed valuation date where both the buyer and the seller have reasonable knowledge of the relevant facts. Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 15 OPERATIONAL ASSUMPTIONS Unless stated otherwise, our analysis (i) assumes that, as of the valuation date, the Company and its assets will continue to operate as configured as a going concern, (ii) is based on the past, present and future projected financial condition of the Company and its assets as of the valuation date, and (iii) assumes that the Company has no undisclosed real or contingent assets or liabilities, other than in the ordinary course of business, that would have a material effect on our analysis. COMPETENT MANAGEMENT ASSUMED It should be specifically noted that the valuation assumes the property will be competently managed and maintained over the expected period of ownership. This appraisal engagement does not entail an evaluation of management’s effectiveness, nor are we responsible for future marketing efforts and other management or ownership actions upon which actual results will depend. NO OBLIGATION TO PROVIDE SERVICES AFTER COMPLETION Valuation assignments are accepted with the understanding that there is no obligation to furnish services after completion of the original assignment. If the need for subsequent services related to a valuation assignment occurs, including updates, conferences, testimony, preparation for testimony, document production, interrogatory response preparation, or reprint and copy services whether by request of the Company or by subpoena or other legal process initiated by a party other than the Company, Company agrees to compensate CBIZ for its time at its standard hourly rates then in effect, plus all expenses incurred in the performance of said services. CBIZ reserves the right to make adjustments to the analysis, opinion and conclusion set forth in the report as we deem necessary by consideration of additional or more reliable data that may become available. NO OPINION IS RENDERED AS TO LEGAL FEE OR PROPERTY TITLE No opinion is rendered as to legal fee or property title. No opinion is intended in matters that require legal, engineering or other professional advice that has been or will be obtained from professional sources. LIENS AND ENCUMBRANCES We will give no consideration to liens or encumbrances except as specifically stated. We will assume that all required licenses and permits are in full force and effect, and we make no independent on-site tests to identify the presence of any potential environmental risks. We assume no responsibility for the acceptability of the valuation approaches used in our report as legal evidence in any particular court or jurisdiction. Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 16 INFORMATION PROVIDED BY OTHERS Information furnished by others is presumed to be reliable; no responsibility, whether legal or otherwise, is assumed for its accuracy and cannot be guaranteed as being certain. All financial data, operating histories and other data relating to income and expenses attributed to the business have been provided by management or its representatives and have been accepted without further verification except as specifically stated in the report. PROSPECTIVE FINANCIAL INFORMATION Valuation reports may contain prospective financial information, estimates or opinions that represent reasonable expectations at a particular point in time, but such information, estimates or opinions are not offered as forecasts, prospective financial statements or opinions, predictions or as assurances that a particular level of income or profit will be achieved, that events will occur or that a particular price will be offered or accepted. Actual results achieved during the period covered by our prospective financial analysis will vary from those described in our report, and the variations may be material. Any use of management’s projections or forecasts in our analysis will not constitute an examination, review or compilation of prospective financial statements in accordance with standards established by the American Institute of Certified Public Accountants (AICPA). We will not express an opinion or any other form of assurance on the reasonableness of the underlying assumptions or whether any of the prospective financial statements, if used, are presented in conformity with AICPA presentation guidelines. GOVERNING LAW This Agreement shall be governed by and construed in accordance with the laws of the State of Ohio, without regard to conflicts of law principles. The parties hereby irrevocably submit to the jurisdiction of the federal or state courts in the State of Ohio, specifically and exclusively in the Cuyahoga County Court of Common Pleas or the Federal District Court for the Northern District of Ohio, over any dispute or proceeding arising out of this Agreement and agree that all claims in respect of such dispute or proceeding shall be heard and determined in such court. The parties to this Agreement hereby irrevocably waive, to the fullest extent permitted by applicable law, any objection that they may have to the venue of any such dispute brought in such court or any defense of inconvenient forum for the maintenance of such dispute. Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 17 ATTACHMENTS Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 19 Attachment # 3 - No Conflict of Interest/Non Collusion Affidavit Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 22 Attachment # 1 – Public Entity Crimes and Conflicts of Interest Affidavit Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 25 Attachment # 2 – Drug Free Workplace Form Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 27 Professional Qualifications – Additional Staff Santo Rizzo Senior Consultant Mr. Rizzo is a Senior Consultant in CBIZ Valuation Group’s Capital Asset Practice. His responsibilities include conducting building & contents inspections, collecting underwriting data, and performing valuations. Prior to joining CBIZ Valuation Group, Santo was a Manager in the marketing industry. Santo earned his Bachelor of B.B.A. in Business Management & Marketing from Saint Xavier University in Chicago, Illinois. Eddie Charleston Senior Consultant Mr. Charleston is a consultant for the Capital Asset Practice of CBIZ Valuation Group. His responsibilities include field data collection, data processing, asset valuation, data review, project management and report compilation. Prior to joining CBIZ Valuation Group, Mr. Charleston worked at a national firm in their Asset Management department. John O’Brien Senior Consultant Mr. O’Brien is a Senior Consultant in CBIZ Valuation Group’s Capital Asset Practice and has over 20 years of insurance inspection and valuation experience. His responsibilities include project management, field data collection, safety inspections, data processing, valuation, quality control and report compilation. Prior to joining CBIZ Valuation Group, John was an independent commercial inspector and worked with numerous national insurance companies. His responsibilities included conducting commercial loss control surveys and providing recommendation reports. His previous experience in the industry includes providing risk evaluations for a full range of personal lines exposures, performing commercial loss control and high value surveys, claims review and conflict mediation. Mr. O’Brien earned a Bachelor of Science in Business Administration from Ferris State University in Big Rapids, Michigan Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 28 Insurance Documents INSR ADDL SUBR LTR INSR WVD DATE (MM/DD/YYYY) PRODUCER CONTACT NAME: FAXPHONE (A/C, No):(A/C, No, Ext): E-MAIL ADDRESS: INSURER A : INSURED INSURER B : INSURER C : INSURER D : INSURER E : INSURER F : POLICY NUMBER POLICY EFF POLICY EXPTYPE OF INSURANCE LIMITS(MM/DD/YYYY)(MM/DD/YYYY) GENERAL LIABILITY AUTOMOBILE LIABILITY UMBRELLA LIAB EXCESS LIAB WORKERS COMPENSATION AND EMPLOYERS' LIABILITY DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES (Attach ACORD 101, Additional Remarks Schedule, if more space is required) AUTHORIZED REPRESENTATIVE INSURER(S) AFFORDING COVERAGE NAIC # Y / N N / A (Mandatory in NH) ANY PROPRIETOR/PARTNER/EXECUTIVE OFFICER/MEMBER EXCLUDED? EACH OCCURRENCE $ DAMAGE TO RENTEDCOMMERCIAL GENERAL LIABILITY $PREMISES (Ea occurrence) CLAIMS-MADE OCCUR MED EXP (Any one person)$ PERSONAL & ADV INJURY $ GENERAL AGGREGATE $ GEN'L AGGREGATE LIMIT APPLIES PER:PRODUCTS - COMP/OP AGG $ $PRO-POLICY LOCJECT COMBINED SINGLE LIMIT $(Ea accident) BODILY INJURY (Per person)$ANY AUTO ALL OWNED SCHEDULED BODILY INJURY (Per accident)$AUTOS AUTOS HIRED AUTOS NON-OWNED PROPERTY DAMAGE $AUTOS (Per accident) $ OCCUR EACH OCCURRENCE $ CLAIMS-MADE AGGREGATE $ DED RETENTION $$ WC STATU-OTH- TORY LIMITS ER E.L. EACH ACCIDENT $ E.L. DISEASE - EA EMPLOYEE $ If yes, describe under E.L. DISEASE - POLICY LIMIT $DESCRIPTION OF OPERATIONS below SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POLICY PROVISIONS. THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER. IMPORTANT: If the certificate holder is an ADDITIONAL INSURED, the policy(ies) must be endorsed. If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). COVERAGES CERTIFICATE NUMBER:REVISION NUMBER: CERTIFICATE HOLDER CANCELLATION © 1988-2010 ACORD CORPORATION. All rights reserved. The ACORD name and logo are registered marks of ACORDACORD 25 (2010/05) ACORDTM CERTIFICATE OF LIABILITY INSURANCE 7/06/2012 CBIZ Insurance Services 9755 Patuxent Woods Drive Suite 200 Columbia, MD 21046 888-553-8500 CBIZ, Inc. and subsidiaries 6050 Oak Tree Blvd., South, Suite 500 Cleveland, OH 44131 The Hartford The American Insurance Co 21857 A X X 42UENMF4642 09/30/2011 09/30/2012 1,000,000 300,000 10,000 1,000,000 2,000,000 2,000,000 A X 42UENMF4643 09/30/2011 09/30/2012 1,000,000 B X X 0 SUO00014824809 09/30/2011 09/30/2012 25,000,000 25,000,000 A A N 42WNMF4640 42WBRMF4641WI 09/30/2011 09/30/2011 09/30/2012 09/30/2012 X 1,000,000 1,000,000 1,000,000 RE: RFP - Inventory and Valuation Services City of South Miami is an additional insured under Commercial General Liability coverage if required by written contract. Policy Basis - Primary and Non-Contributory Waiver of Subrogation - General Liability, Automobile Liability and Workers Compensation - Included City of South Miami Office of the City Clerk South Miami City Hall 6130 Sunset Drive Miami, FL 33143 1 of 1 #S620589/M513239 CBIZINCClient#: 2372 SGM 1 of 1 #S620589/M513239 INSR ADDL SUBR LTR INSR WVD DATE (MM/DD/YYYY) PRODUCER CONTACT NAME: FAXPHONE (A/C, No):(A/C, No, Ext): E-MAIL ADDRESS: INSURER A : INSURED INSURER B : INSURER C : INSURER D : INSURER E : INSURER F : POLICY NUMBER POLICY EFF POLICY EXPTYPE OF INSURANCE LIMITS(MM/DD/YYYY)(MM/DD/YYYY) GENERAL LIABILITY AUTOMOBILE LIABILITY UMBRELLA LIAB EXCESS LIAB WORKERS COMPENSATION AND EMPLOYERS' LIABILITY DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES (Attach ACORD 101, Additional Remarks Schedule, if more space is required) AUTHORIZED REPRESENTATIVE INSURER(S) AFFORDING COVERAGE NAIC # Y / N N / A (Mandatory in NH) ANY PROPRIETOR/PARTNER/EXECUTIVE OFFICER/MEMBER EXCLUDED? EACH OCCURRENCE $ DAMAGE TO RENTEDCOMMERCIAL GENERAL LIABILITY $PREMISES (Ea occurrence) CLAIMS-MADE OCCUR MED EXP (Any one person)$ PERSONAL & ADV INJURY $ GENERAL AGGREGATE $ GEN'L AGGREGATE LIMIT APPLIES PER:PRODUCTS - COMP/OP AGG $ $PRO-POLICY LOCJECT COMBINED SINGLE LIMIT $(Ea accident) BODILY INJURY (Per person)$ANY AUTO ALL OWNED SCHEDULED BODILY INJURY (Per accident)$AUTOS AUTOS HIRED AUTOS NON-OWNED PROPERTY DAMAGE $AUTOS (Per accident) $ OCCUR EACH OCCURRENCE $ CLAIMS-MADE AGGREGATE $ DED RETENTION $$ WC STATU-OTH- TORY LIMITS ER E.L. EACH ACCIDENT $ E.L. DISEASE - EA EMPLOYEE $ If yes, describe under E.L. DISEASE - POLICY LIMIT $DESCRIPTION OF OPERATIONS below SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POLICY PROVISIONS. THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER. IMPORTANT: If the certificate holder is an ADDITIONAL INSURED, the policy(ies) must be endorsed. If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). COVERAGES CERTIFICATE NUMBER:REVISION NUMBER: CERTIFICATE HOLDER CANCELLATION © 1988-2010 ACORD CORPORATION. All rights reserved. The ACORD name and logo are registered marks of ACORDACORD 25 (2010/05) ACORDTM CERTIFICATE OF LIABILITY INSURANCE 7/06/2012 CBIZ Insurance Services 9755 Patuxent Woods Drive Suite 200 Columbia, MD 21046 888-553-8500 CBIZ, Inc. & subsidiaries 6050 Oak Tree Blvd., South, Suite 500 Cleveland, OH 44131 Lexington Insurance Co A Prof Liab - E&O IA -Broker Dealer 026030236 Same 12/15/2011 Same 12/15/2012 Same $20,000,000 Aggregate $7,500,000 Sublimit Investment Banking - $1,000,000 Sublimit RE: RFP - Inventory and Valuation Services City of South Miami Office of the City Clerk South Miami City Hall 6130 Sunset Drive Miami, FL 33143 1 of 1 #S620590/M538483 CBIZINCClient#: 2372 SGM 1 of 1 #S620590/M538483 Ms. Maria M. Menendez City of South Miami July 9, 2012 Page 31 Price Proposal Sheet