Resolution No. 2012-079RESOLUTION NO. 2012-79
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
VERNON APPROVING AND AUTHORIZING THE EXECUTION OF
AN ENGAGEMENT LETTER AGREEMENT BY AND BETWEEN THE
CITY OF VERNON AND JOHN VAN DE KAMP AND MAYER BROWN
LLP TO SERVE AS AN INDEPENDENT REFORM MONITOR
WHEREAS, on January 3, 2012, the City Council of the City of
Vernon adopted Resolution No. 2012-06 approving an agreement with John
van de Kamp ("Van de Kamp") and Dewey & LeBoeuf LLP ("Dewey") to serve
as Independent Ethics Advisor for the City; and
WHEREAS, Van de Kamp notified the City that he was no longer
associated with Dewey and is now working with Mayer Brown LLP
("Mayer"); and
WHEREAS, the City of Vernon desires to retain the services
of Van de Kamp and Mayer to serve as the independent reform monitor
commencing May 14, 2012 and ending on February 15, 2016; and
WHEREAS, the City Council of the City of Vernon has
determined that, pursuant to the provisions of subsection (b)(1) and
(7) of Section 2.27 of the Vernon City Code, it is in the public
interest and necessity to enter into an Engagement Letter Agreement
wi�th Van de Kamp to serve as the City's Independent Reform Monitor.
I
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF VERNON AS FOLLOWS:
SECTION 1: The City Council of the City of Vernon does
hereby find and determine that the recitals contained hereinabove
are true and correct.
SECTION 2: The City Council of the City of Vernon hereby
approves the Engagement Letter Agreement (the "Agreement"), in
substantially the same form as the copy which is attached hereto as
Exhibit A.
SECTION 3: The City Council of the City of Vernon hereby
authorizes the Mayor or Mayor Pro-Tem to execute the Agreement for, and
on behalf of, the City of Vernon and the City Clerk, or Deputy City
Clerk, is hereby authorized to attest thereto.
SECTION 4: The City Council of the City of Vernon hereby
instructs the City Administrator, or his designee, to take whatever
actions are deemed necessary or desirable for the purpose of
implementing and carrying out the purposes of this resolution and the
transactions herein approved or authorized.
SECTION 5: The City Council of the City of Vernon hereby
directs the City Clerk, or the City Clerk's designee, to send,a fully
executed Agreement to Mayer Brown LLP.
SECTION 6: The City Clerk of the City of Vernon shall
certify to the passage, approval and adoption of this resolution, and
the City Clerk of the City of Vernon shall cause this resolution and
the City Clerk's certification to be entered in the File of Resolutions
of the Council of this City.
APPROVED AND ADOPTED this 5 th day of June, 2012.,
Name: TA7411i am J. Davis
Title:�M �, Mayor Pro-Tem
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STATE OF CALIFORNIA
) ss
COUNTY OF LOS ANGELES
I, Willard G. Yamaguchi, City Clerk of the City of Vernon, do
hereby certify that the foregoing Resolution, being Resolution
No. 2012-79, was duly passed, approved and adopted by the City Council,
of the City of Vernon at a regular meeting of the City Council duly
held on Tuesday, June 5, 2012, and thereafter was duly signed by the
Mayor or Mayor Pro-Tem of the City of Vernon.
Executed this day of June, 2012, at Vernon, California.
(SEAL)
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EXHIBIT A
May 18,2012
Attn: City Administrator
City of Vernon
43 05 Santa Fe Avenue
Vernon, CA 90058
Re: Representation by Mayer Brown LLP
Dear Mr. Whitworth:
MAYER--BROWN
Mayer Brown LLP
350 South Grand Avenue
251h Floor
Los Angeles, Calffornia 90071-1503
Main Tel +1213 229 9500
Main Fax +1213 625 0248
wwwmayerbrovm.com
John K. Van de Kamp
Direct Tel +1213 229 9511
Direct Fax 2131576.8116
ivandekamp@mayerbrm.com
We are pleased that you have asked John Van de Kamp and his firm, Mayer Brown LLP,
a limited liability partnership established in the United States (the "Firm"), to serve as an
Independent Reform Monitor (the "Monito "). With this letter, we provide you with an
explanation of the representation and address (1) identification of our client; (2) scope of our
engagement; (3) conflicts of interest; and (4) fees, expenses and other charges. This letter, the
Standard Terms of Engagement that are attached as Exhibit , and the attached Schedule of Non
Fee Charges to Clients govern our relationship.
1. Client. This engagement does not create an attorney -client relationship with the City
of Vernon or any of its representatives or employees, although Mayer Brown's costs of
representation will be reimbursed by the City of Vernon for payment to Mayer Brown.
2. Scope of Engagement John Van de Kamp and Mayer Brown are engaged as an
Independent Reform Monitor to: (a) Assess and make recommendations regarding ongoing
compliance with the Political Reform Act of 1974, Government Code Section 1090, Brown Act,
Public Records Act and any other provisions of law governing conflicts of interest and/or
transparency in government; (b) make recommendations to the City reasonably designed to
improve and enhance the existing practices, procedures and policies governing conflicts of
interest and open government of the City, its departments, divisions, and governing bodies, and
(c) to review the City's governance reform measures and initiatives, and recommend measures
and initiatives in the best interest of the City.
The term of this agreement shall be for the period beginning May 14, 2012, and ending
February 15, 2016 subject to the termination provisions set forth in paragraph 5 herein.
Other than the Monitor's role as Vernon's Independent Ethics Advisor ending February
15, 2012, the Monitor has had no pre-existing relationship with the City of Vernon and shall
satisfy himself that he can be effective and impartial in the performance of the Monitor's duties.
The Monitor is, and shall remain at all times, an independent third -party, not an employee or
agent of the City of Vernon, and shall conduct his affairs accordingly. The Monitor shall
Mayer Brown LLP operates in combination with other Mayer Brown entities with offices in Europe and Asia
AMECURRENT 70203,,2,., 063and is associated with Tauil & Chequer Advogados, a Brazilian law partnership,
Mayer Brown LLP
Attn: City Administrator
May 18,2012
Page 2
perform his or her duties in a professionally independent and objective fashion, as appropriate to
the nature of the engagement.
The Monitor's duties and authority, and the obligations of the City of Vernon with
respect to the Monitor, are set forth below. All provisions defining the Monitor's jurisdiction,
powers, oversight authority and duties shall be broadly construed.
The Monitor shall:
a. Review and evaluate the effectiveness of the City of Vernon's internal controls,
record -keeping, internal audit, and existing or new reporting policies and procedures with respect
to the Political Reform Act of 1974, Government Code Section 1090, Brown Act, Public
Records Act and conflict of interest requirements.
b. Review and evaluate from a legal perspective the effectiveness of the City of
Vernon's policies and procedures relating to reimbursement of expenses and payment of invoices
to any individual affiliated with the City or the City Council, including City employees, and shall
make recommendations to the City regarding such policies.
C. Review and evaluate from a legal perspective the effectiveness of the City of
Vernon's policies for selecting, engaging and paying consultants, including the City of Vernon's
conflict of interest policies. The Monitor shall review the structure and content of the City of
Vernon's current consulting agreements, and payments made to consultants thereunder. The
Monitor shall also review any consulting agreements proposed during the term of this agreement
and recommend any alterations necessary to ensure the proposed consulting agreement complies
with all policies and procedures.
d. Review and evaluate from a legal perspective whether the City of Vernon has
a . dequate and appropriate policies pertaining to ethics and conflicts of interest. The Monitor shall
evaluate the extent of existing training and education and, where the Monitor deems appropriate,
make recommendations regarding additional training and education relating to ethics and
conflicts of interest.
e. Review the implementation of the measures recommended by the Independent
Ethics Advisor on July 29, 2011 and January 31, 2012, and those recommended by Senator
Kevin de Leon on August 22, 2011 and make recommendations regarding their implementation
and such other measures which may be called for which are in the best interest of the City.
The City of Vernon will cooperate fully with the Monitor. To that end, the City of
Vernon shall provide the Monitor with access to all non -privileged information, documents, and
records that relate to the responsibilities of the Monitor. The City of Vernon mill further provide
the Monitor with access to all employees, consultants or Monitors and shall encourage full
cooperation with the Monitor.
AMECURRENT 702035028.1 063
Mayer Brown LLP
Attn: City Administrator
May 18, 2012
Page 3
The City of Vernon shall not be obligated to provide the Monitor with materials or
information protected by the attomey-client privilege or work product doc trine. The Monitor
shall where necessary take appropriate steps to maintain the confidentiality of any information
entrusted to him. The Monitor will undertake to avoid disruption of the City of Vernon's
ordinary operations.
The Monitor shall have the power to conduct audits of all city operations and budgets as
well as the power to review any proposed service contract that is substantial in nature.
The Monitor may, at the City of Vernon's expense, select and hire outside legal counsel,
consultants, investigators, auditors, experts or other professionals to work under his direction for
the proper discharge of the Monitor's duties. Before retention, the Monitor shall provide to the
City Administrator a notice of the retention and a proposed budget for their retention. The City
Administrator shall not withhold reasonable retention requests: if the City Administrator and/or
the City Counsel finds such requests unreasonable, such findings shall be communicated to the
Monitor no later than 15 days after submission of the retention and the budget proposal, and
permit the Monitor to submit an alternative proposaL
On or before July 31, 2012, the Monitor shall issue an written report to the City
Administrator and City Council and the state legislature detailing the Monitor's findings and
recommendations, if any, designed to improve the City of Vernon's internal controls, policies
and procedures. The Monitor shall issue such a report every 6 months, i.e., shall be issued by
January 31 and July 31 of each year of this contract.
Within forty-five (45) days after receiving the reports, the City Administrator and City
Council shall advise the Monitor in writing of any recommendations that the City Administrator
and City Council consider unduly burdensome, impractical, costly or which would otherwise
impair the day-to-day operation of the City. With respect to any recommendation made by the
Monitor that is not adopted by the City Administrator and City Council, the City Administrator
and City Council shall propose in writing an alternative policy, procedure or system designed to
achieve the same objective or purpose.
The Monitor shall undertake follow-up reviews during the term of this retention as
reasonably deemed necessary and appropriate.
In order for the Monitor to fulfill his obligation, the City Administrator shall provide
adequate office space for the Monitor and his staff to conduct its on site work.
The Monitor's assignment may be expanded at the express direction of the City of
Vernon's City Administrator and/or City Council.
AMECURRENT 702035028.1063
Mayer Brown LLP
Attn: City Administrator
May 18, 2012
Page 4
3. Loyalty and Conflicts of Interests.
City of Vernon agrees that the Monitor is independent and that this shall not preclude
Mayer Brown LLP from representing either existing or future clients in other matters.
Clients with Conflicting Interests. During or after the time we are engaged in this matter,
some other curTent or future client may ask us to represent it in connection with some dispute,
transaction, litigation, arbitration or other matter that is not substantially related to this
engagement in which the interests of such client may be directly adverse to your interests. You
agree that, consistent with the California Rules of Professional Conduct (the "Rules") and the
California Business and Professions Code, Mayer Brown LLP may continue, or in the future
undertake, to represent any existing or new client in any such matter, provided that such
representation is not substantially related to this engagement.
Agreement to Firm's Consultation with Lawyers and Experts. In addition, in the course
of this engagement, and in order fully to satisfy our professional obligations, we may from time
to time need to consult with the lawyers in this firm or outside lawyers or experts retained by the
firm responsible for advising the firm on issues of professional ethics and responsibility,
including issues that may implicate your interests. You acknowledge and agree that,
notwithstanding the potential for conflict in our consideration of our professional obligations, the
firm is free to consult with such counsel or experts at its own expense on such matters consistent
with the firm's obligations under the applicable rules of professional conduct.
4. Fees, Expenses and Other Charges.
Fees. Our fees for professional services in connection with this engagement will
generally reflect, and be determined primarily on the basis of, the hours worked by Mayer Brown
attorneys and paralegals and the hourly rates in effect at the time the services are rendered shall
not exceed $550 per hour. However, if the cost of living index C'CPI") increases 15% as
measured from February 15, 2012, the rate will be increased by that level (15%), upon notice to
The City. No further increases will sought during the duration of the engagement. John Van de
Kamp who will be the primary Mayer Brown attorney working on this matter has a billing rate of
$550 per hour. Partners and associates will be used as needed and are charged at rates ranging
from $300-$525 per hour. Paralegals are charged at the rate of no more than $200 per hour. The
minimum billing unit for this representation is .25 of an hour. The amount of our fee takes into
account all relevant circumstances and factors as set forth in the Rules as it applies to us as
attorneys, including the nature of the services performed, the amount of time spent, the
experience and ability of the lawyers and paralegals working on this engagement, the novelty
and complexity of the specific issues involved, the time limitations imposed by you or the
circumstances and the responsibilities undertaken by us.
I Expenses and Other Charges. During the course of the engagement� the City of Vernon
will also be responsible for all expenses and service charges relating to our engagement, whether
billed directly by us or by individuals or entities retained by us. Mayer Brown's expenses and
AMECURRENT 702035028.1 063
Mayer Brown LLP
Attn: City Administrator
May 18,2012
Page 5
other charges are listed in Attachment A. Unless special arrangements are made, the fees,
expenses and charges of others (such as experts, investigators, local counsel, consultants and
document service providers who are expected to be primarily from the L.A. area) and other large
disbursements will not be paid by us, but will be the sole responsibility of, and billed directly to,
City of Vernon. These bills will be reviewed and approved by the Monitor. Any expenses for
travel outside of Los Angeles County or travel expenses in excess of $150 must be approved in
advance by the City of Vernon.
Billing and Payment. In the normal course, you will receive on a monthly basis a
confidential statement of professional services rendered and expenses and service charges
incurred during the preceding month. Mayer Brown will bill City of Vernon directly.
We expect that our statements will be paid promptly upon receipt by the City of Vernon,
and in any event within 30 days after the invoice date. If you have any questions or comments
concerning our services or charges during the course of our representation, please bring them to
my attention so that any problems can be quickly resolved.
5. Indemnification. City of Vernon agrees to indemnify the Monitor and the Firm
from and against any and all losses, claims, damages and liabilities, joint or several, to which the
Monitor and the Firm may become subject under any applicable Federal or state law, or
otherwise, and related to or arising out of the engagement of the Monitor and the Finn pursuant
to, and the performance by the Monitor and the Firm of the services contemplated by, this
Agreement and will reimburse the Monitor and the Finn for all reasonable expenses (including
counsel fees and expenses) as they are incurred in connection with the investigation of,
preparation for or defense of any pending or threatened claim or any action or proceeding arising
therefrom, whether or not the Monitor and/or the Firm is party and whether or not such claim,
action or proceeding is initiated or brought by or on behalf of City of Vernon. City of Vernon
also agrees that the Monitor and the Firm shall have no liability (whether direct or indirect, in
contract or tort or otherwise) to the City of Vernon or its security holders or creditors related to
or arising out of the engagement of the Monitor and the Firm pursuant to, or the performance by
the Monitor and the Firin of the services contemplated by, this Agreement except to the extent
that any loss, claim, damage or liability is found in a final judgment by a court to have resulted
from the Monitor's bad faith or gross negligence.
City of Vernon agrees that, without the Monitor's and the Firm's prior written consent, it
will not settle, compromise or consent to the entry of any judgment in any pending or threatened
claim, action or proceeding in respect of which indemnification could be sought under the
indemnification provision in this letter agreement (whether or not the Monitor and/or the Firm
are an actual or potential party to such claim, action or proceeding), unless such settlement,
compromise or consent includes an unconditional release of the Monitor and the Firm from all
liability arising out of such claim, action or proceeding.
In the event that the Monitor is requested to appear as a witness in any action brought by
or on behalf of or against City of Vernon or any City of Vernon affiliate in which the Monitor is
AMECURRENT 702035028.1063
Mayer Brown LLP
Attn: City Administrator
May 18,2012
Page 6
not named as a defendant, including by subpoena duces tecurn City of Vernon agrees to
reimburse the Monitor and the Firm for all reasonable expenses incurred by him in connection
with the Monitor's appearing and preparing to appear as such a witness, including, without
limitation, the fees and disbursements of his outside legal counsel, and to compensate the
Monitor and the Firm at the hourly rate the Monitor is compensated pursuant to this Agreement.
City of Vernon's obligations under this section, "Indemnification", will survive any
termination of this Agreement. For avoidance of doubt, the obligations set for this section apply
to John Van de Kamp, the Finn, and any partner, employee or other person working for and with
Mayer Brown in connection with this engagement.
6 Term of Engagement The City of Vernon has the right to tenninate our
engagement at any time for cause or upon the death or incapacitation of John Van de Kamp,
upon written notice, and all outstanding charges will become due at that time. We reserve the
right to withdraw from the engagement at any time consistent with the rules of professional
conduct. We may also suspend or terminate work on behalf of a client that does not pay our
statements within 90 days after they are rendered. Our right to withdraw as Monitor shall, of
course, be consistent with the applicable provisions of the Rules,
Upon the termination of this engagement, we will either make arrangements to return to
you, or by your direction to the Vernon City Attorney, all copies or originals of documents or
materials belonging to you or otherwise constituting your records, store them at the City of
Vernon's expense or dispose of them. You agree that we may keep copies of such files if we so
choose. You also agree that our own internal files (including but not limited to firm
administrative records, time and expense reports, personnel and staffing materials, accounting
records and related documents) and attorney work product (including without limitation drafts,
notes, legal memoranda, and other legal and factual research reflecting our opinions and mental
impressions) pertaining to this matter are our property and will not be delivered to you at the
conclusion or upon the termination of our engagement, except that the City of Vernon shall be
entitled to any final research memoranda, and also to any documents supplied by third parties.
Governing Law. Our engagement shall be governed by, and construed in accordance
with, the laws of the State of California, exclusive of the law of conflicts of laws.
If a dispute develops about our fees, the City.of Vernon may be entitled under Section
6200, et seq., of the California Business and Professions Code to arbitration of that dispute.
All actions or proceedings arising out of or relating to this engagement (other than those
to which Section 6200 et seq. applies) shall be heard and determined in California state or federal
court sitting in the County of Los Angeles, to whose jurisdiction all parties to this engagement
letter irrevocably and exclusively submit. In connection with any such proceeding, you and the
City of Vernon irrevocably waive to the fullest extent permitted by law, any defense of forum
non conveniens. You also irrevocably agree that service of process may be made on the City of
Vernon by service of a copy of the summons and complaint by certified mail to Vernon's City
AMECURUNT 702035028.1 063
Mayer Brown LLP
Attn: City Administrator
May 18,2012
Page 7
Attorney by certified mail to the Office of City Attorney, 4305 Santa Fe Avenue, Vernon, CA
90058. Nothing herein shall limit the right of the parties to stipulate and agree to submit any
dispute to binding arbitration in lieu of litigation.
The terms of this engagement can be modified only by written agreement of all the
parties hereto.
If the foregoing correctly reflects the terms and conditions of our engagement, please
indicate your acceptance by executing the enclosed copy of this letter in the space provided
below and return it to our office. The effective date of our engagement will be the date on which
our service commenced.
We are delighted that we will have the opportunity to work with you on this matter. If
you have any questions about the terms of our engagement, please do not hesitate to give me a
call. We are very much looking forward to working with you and your colleagues.
If you have any questions, please call me. Otherwise please sign and return the enclosed
copy of this letter.
Very truly yours,
MAYER BROWN LLP
BY: �>\ �1 � V 'j 1—k &*
AGREED: ('—) John K. Van de Kamp
By: William Davis ATTEST:
Its: —Mayor Pro-Tem
Date:
Enclosures
cc: John Mathews
Willard G. Yamaguchi, City Clerk
APPROVED AS TO FORM:
Willard G. Yamaguchi, Chief Deputy
City Attorney
AMECURRENT 702035028.1063
Mayer Brown LLP
U. S. Offices
Schedule of Non -fee Charpes to Clients
July, 2011
1. Lonp, Distance Telel)hone.
We purchase our long-distance telephone service from telecommunications providers at
discounted rates. We charge clients at rates calculated to recover our cost.
11. Automated Research.
We purchase services from Lexis and Westlaw at fixed monthly rates which are substantially
below their published rates. We charge clients for the Lexis and Westlaw connections at rates
calculated to recover our cost.
III. Telefax Service.
We charge clients $1.00 per page, plus applicable long distance telephone charges regardless of
length at our discounted rates. There is no charge for incoming telefaxes.
IV. Document Revroduction.
We charge clients for standard -size internal black and white copies at the rate of $.15 per page.
We charge clients for standard -size internal color document reproduction (if specifically
requested by clients) at the rate of $ 1.00 per page. We currently reproduce documents using
photocopiers, laser printers, and digital copiers, and may in the future use other means of
reproduction. Outside copying is charged at actual out-of-pocket cost.
V. Secretarial, Word Processing and Proofreading, Services.
We accrue for client accounts document preparation charges at the rate of $ 100 per hour for
word processors and secretaries generally when documents (originals or amendments) of over 10
pages are prepared or for secretarial overtime. Proofreading services accrue at the rate of $120
per hour.
AMECURRENT 702035028.1063
VI. Mayer Brown Provided Electronic DiscovM Services.
To the extent that the Client elects to host electronic discovery information on the Firm's
Electronic Discovery Services ("EDS") servers, we charge a monthly comprehensive services fee
for hosting and supporting that data. We calculate this charge for each month based on the data
volume residing on the ED S servers at the end of such month, at a rate of $65 per gigabyte
("GB"), which covers EDS department expenses relating to that internally supported data,
including any hosting expenses, processing, handling, and response to case team or Client needs.
VIL Postage.
We charge clients at cost for postage when the cost of mailing is $1.00 or more.
VIII. Out-of-pocket Disbursements.
The following types of disbursements when related to a client matter are charged at the firm's
cost:
Advances on behalf of clients (e.g., tax payments, filing fees, title
charges)
Consultants' and expert witnesses' fees and expenses
Courier and messenger services
Court reporters
Equipment when purchased solely for a client matter
Meals
Outside services (including cost of litigation support services
purchased from outside vendors)
Service of process
Records searches
Supplies (when amounts are large or type of supply item is special)
Tax return processing charges
Taxis, mileage, parking (local)
Travel (airfares, hotels, meals, car rentals, fees of travel agencies
and professionals, taxis and incidentals)*
Trial exhibits
Witness fees and costs
Other items not covered above that are directly attributable to a
client matter
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AMECURRENT 702035028.1063
*When our independent travel agency of record is used to book
airfare there is a fee charged of not more than $32 per
reservation to reduce the cost of the Travel Department.
IX. Items Not Charged to Clients.
Administrative overhead
Air conditioning and electricity for overtime work
Client entertainment
Local and suburban telephone calls
Rent for conference rooms
-3-
AMECURRENT 702035028,1063
EXHIBIT A
MAYER BROWN LLP
STANDARD TERMS OF ENGAGEMENT
Governine Terms.
This Standard Terms of Engagement sets forth our standard terms of engagement as your
lawyers. Unless modified in writing by mutual written agreement, these terms are an integral part
of your engagement of our Firm (as hereinafter defined). Our employment on your behalf is
limited to those specific matters which we agree to undertake.
Mayer Brown is a global legal services organization comprising legal practices which are
separate entities ("Mayer Brown Practices"). The Mayer Brown Practices are: Mayer Brown
LLP, a limited liability partnership established in the United States (the "Firm"); Mayer Brown
International LLP, a limited liability partnership incorporated in Eng7lan—d and Wales (the
"EnOish Firm"); Mayer Brown Europe -Brussels LLP, a limited liability partnership established
in the United States (the "Brussels Firm"); Mayer Brown, a SELAS established in France (the
"French SFLAS"); Mayer Brown JSM, a Hong Kong partnership, and its associated entities in
Asia; and Tauil & Chequer Advogados, a Brazilian partnership with which Mayer Brown is
associated. These terms govern the relationship between the Firm and the "Client", as defined in
the letter to which these terms are attached C'Cover Lette "). The Cover Letter and these
Standard Terms of Engagement, together with 0 undertaking letters, constitute the entire
understanding between the Firm and the Client, and supersede all prior understandings, written
or oral, relating to our engagement. Any change must be made or confirmed in writing by the
Firm and the Client.
The Client agrees that in connection with any undertaking the Firm may, where appropriate, as
agent on the Client's behalf, engage another Mayer Brown Practice to work alongside the Firm
on a matter upon its standard terms of engagement, a copy of which will be supplied to the Client
upon request. The Client will not, however, be a client of another Mayer Brown Practice unless
the Firm has engaged it as described above or the Client has entered into an agreed engagement
directly with it.
Unless the Firm has otherwise specifically agreed with the Client, the Client agrees that the Firm
may disclose that it represents the Client, including in materials which the Firm uses to describe
its practices and expertise.
I . Fees.
The Client agrees to pay the fees and other charges billed by the Finn, and, where appropriate,
the other Mayer Brown Practices. The Firm's fees for services generally are based on time (in
quarter hour increments, except if our fees require bankruptcy court approval they may have to
be recorded to the nearest tenth of an hour) spent on specific projects, computed at our hourly
rates for those persons performing the services. Hourly rates are all subject to adjustment by the
Firm from time to time. If contract, or independent contractor, lawyers or paralegals are assigned
to work on any matter which the Firm undertakes on behalf of the Client, whether or not they are
employed through an independent agency, the Finn will charge the Client hourly rates based
upon its then from time to time hourly rates for Firm lawyers and paralegals with similar
AMECURRENT 702035028.1 063
qualifications and experience. After consultation, we also may take into account additional
factors in performing our services in connection with any matter, such as unusual time
limitations, particularly favorable results obtained, the unusual level of skill required, the
efficiency with which the services were performed and other relevant considerations. Other
charges for which we will bill are described on the enclosed current schedule of charges, which
is subject to adjustment from time to time. Any estimate of the fees and other charges that may
be incurred in connection with the services we will provide on any matter is not a fixed or
maximum fee and does not constitute a commitment by us to perform the described services for
that amount, or an obligation to pay that amount. We anticipate submitting a monthly invoice for
the professional services (including lawyers and paralegals) rendered and other charges and
expenses incurred in connection with each matter we are handling. Payment is due upon receipt
of our statement and in no event later than 30 days thereafter. We reserve the right to charge
interest on amounts overdue at 2% over the prime rate in effect from time to time as published in
The Wall Street Journal. The Client may at any time request details regarding any matter,
specifying the individuals involved, their positions, the hours and work performed and an
itemization of other charges. If we agree in writing to look first to the Client's customer or
insurer to pay our fees and charges, the Client nonetheless guarantees such payment will be made
,vNithin 30 days. Fees and other charges incur -red in connection with our representation are not
contingent upon the successful completion of any project.
Without limiting any other provision of this Section 1, the Client agrees to compensate the Firm
at its hourly rates (which, as described above, are subject to adjustment from time to time) for
activities incidental to representing the Client, whether during or after the termination of the
attomey-client relationship, including, without limitation, in connection with responding to
subpoenas, searching for and producing documents and preparing for testimony and testifying,
and otherwise preparing for, and responding to, the Client's requests or third party claims or
actions relating to a matter the Firm is handling, or has handled, for the Client. The Client also
agrees to pay, or reimburse the Firm for the payment of, all reasonable expenses and other
charges in connection with such incidental activities, including, without limitation, the fees of
outside counsel retained by the Firm.
2. New York Office, Houston Office.
In the event the Client has a fee dispute with us in an amount that is between $1,000 and
$50,000, it may have the right to seek resolution of that dispute in an arbitration under Part 137
of the Rules of tli& Chief Administrator, New York State Office of Court Administration. For
ftirther infortnation about the fee dispute arbitration procedures, please refer to the text of Part
137, available on the intemet at www.coLuts.state.nv.us/admin/feedispute.
NOTICE TO CLIENTS: The State Bar of Texas requires us to inform you that it prosecutes
professional misconduct committed by Texas attorneys. Although not every complaint against or
dispute with a lawyer involves professional misconduct, the State Bar's Office of Chief
Disciplinary Counsel will provide you with information about how to file a complaint. Please
call 1-800-932-1900 toll -free for more information.
AMECURRENT 702035028.1063 Exhibit A — Page 2
3. Confidentialitv
We will keep confidential any information identified by the Client as being confidential and
which the Client provides to us, except as required or authorized by law or as necessary in our
judgment to perform the services we have been engaged to perform. The Client agrees that we
may disclose confidential information to other Mayer Brown Practices. The other Mayer Brown
Practices have agreed to keep such information confidential, subject, however, to the
requirements of law and regulations, the professional rules governing their conduct and their
respective standard terms of engagement.
4. Conflicts.
The Client agrees that the Firm may represent other persons or entities in matters not
substantially related to matters we are handling for the Client, even though those persons or
entities are, or have interests that are, adverse (whether in transactions, bankruptcy, litigation,
arbitration or other adverse proceedings or otherwise) to the Client or its interests.
We agree, however, that the Client's consent to adverse representation shall not apply in any
instance where, as a result of our representation of the Client, we have obtained sensitive,
proprietary or other confidential information of a non-public nature that, if known to any such
other client of ours, could be used in a matter in which we are retained by our other client to the
Client's material disadvantage unless we have screened our lawyers and paralegals who have
such information from any involvement in the adverse representation.
5. Affiliates.
For the purpose of determining whether a conflict of interest exists, it is only the Client which we
will represent and not its stockholders, subsidiaries or related entities ("affiliates"). The Client
agrees not to give us confidential information regarding its affiliates. While we recognize that to
act adversely to any affiliate could jeopardize a long-term relationship with the Client, which we
would naturally be reluctant to do, for conflict of interest purposes we reserve the right to
represent another client with interests adverse to any affiliate without obtaining any consent from
the Client or its affiliates.
6. Financial Transactions.
Our engagement for any financing transactions for a financial institution will consist solely of
assisting it with the legal aspects of negotiating, documenting and closing of financings, and, if
specifically requested, conducting a legal review (the scope of which will be defined at the
commencement of each transaction) of certain due diligence matters pertaining to each
prospective financed party. We will assume, without independent verification, that each party
exists and is in good standing, that the financing transaction is within the respective parties'
powers and authority, is duly authorized by each of the respective parties and does not violate
their respective constituent documents or any of their respective agreements, that all signatures
and documents are genuine and that all persons executing documents have the legal capacity to
contract. We also will assume, without independent verification, that each financed party is in
compliance with applicable laws and regulations and the financing contracts are enforceable
against each financed party in accordance with their respective terms. Unless otherwise
AMECURRENT 702035028.1063 Exhibit A — Page 3
specified, in reliance upon the related warranties of the financed parties and the assumptions set
out above, we will satisfy ourselves that the financing contracts are, under the relevant state law,
valid, subject to customary qualifications for bankruptcy and general principles of equity
(including concepts such as good faith and fair dealing and commercial reasonableness) and also
subject to the qualification that certain rights set forth in such contracts may not be specifically
enforceable but that such rights as are enforceable are sufficient, taken as a whole, for the
practical realization of the essential legal benefits intended by such contracts.
In connection with the representation of any financial institution, as we are not counsel with
respect to general corporate compliance matters, we will not undertake any responsibility for
assuring that, with respect to financing transactions, the Client will be complying with applicable
state, local or federal laws and regulations because of its legal or regulatory status or because of
the general nature of its business, including, without limitation, any prudential considerations,
capital adequacy requirements, lending limits, restrictions on affiliate and insider transactions,
loan -to -value limitations, tying of products or services, appraisal requirements, rules regarding
interlocking boards of directors, governmental reporting and licensing requirements, and federal,
state or local tax matters.
Whether or not our client is a financial institution, unless we otherwise agree in writing, we do
not: (a) make or cause to be made searches of filing or recording systems; (b) ensure that the
initial filings or recordings of security documents are made; (c) undertake responsibility for
advising the Client upon or ensuring compliance with periodic refiling or re-recording
requirements; (d) opine as to matters relating to the existence of or title to any collateral or the
priority of any liens or security interests.
7. Associations.
In cases where the Client is a trade association or the like, the sole Client is such association and
not any of its individual members or any other persons or entities whose interests are represented
by those members.
8. Joint ReDresentation.
If representing the Client consists of our representation of multiple parties, there may be issues
where there are conflicting or potentially conflicting interests. I� there is a disagreement on any
issue, the Firm asks that differences be resolved without our assistance. If those differences
cannot be resolved, we will not represent any party as to that issue. If the differences are serious
enough, we may determine that it is appropriate for us to withdraw from the matter completely.
Each party in a joint representation is separately, jointly and severally responsible for the full
payment of our bills even though the parties may have agreed among themselves to bear only a
proportionate share. In the case of any joint representation, the parties have agreed there will be
no confidences among them regarding the work we do for them or any confidentiality among
them with respect to communications or information received from any of the parties. If we
receive information from or about one party that we believe others should have in order to make
decisions regarding the subject of our representation, we shall give them that information; and
the attomey-client privilege may not be available with respect to communications to or from any
of the parties and our Firm. In cases where the Client is a joint venture, we will only represent
Exhibit A — Page 4
AMFCURRENT 702035028.3 063
that joint venture and we do not represent the venturers. Such representation does not constitute a
"joint representation".
9. Termination.
Upon the Client's request received at. the termination of the attomey-client relationship, its
papers and physical property ("Client Property') will be returned to the Client. We reserve the
right to destroy or otherwise dispose of any Client Property in our possession after 90 days after
the termination of the attomey-client relationship. The Firm files, including attorney work
product, pertaining to the Client, will be retained, stored or destroyed by us in accordance with
our Then effective policies and procedures.
Either the Client or the Finn may terminate the attomey-client relationship at any time for any
reason by written notice, subject on our part to the applicable rules of professional conduct.
Unless otherwise terminated, our attorney -client relationship will be considered terminated at the
earlier of our completion of the specific services for which we have been retained and 12 months
after the last date the Firm furnished any billable services. If the attomey-client relationship has
been, or is deemed to have been, terminated pursuant to either of the foregoing sentences, the
fact that the Firm or one or more persons associated with the Firm may be identified as a
recipient of (and, in fact, may receive) notice on behalf of the Client shall not negate such
termination nor constitute the continuation or revival, or evidence the continuation or revival, of
the attomey-client relationship. The Firm may maintain a system to calendar due dates for the
payment of maintenance and/or armuity fees relating to, or the renewal dates for the preservation
of certain legal rights attaching to, intellectual property. In connection therewith it may notify the
person or entity listed in the Firm's records as the holder of such rights of the necessity of paying
maintenance and/or annuity fees or obtaining a renewal in order to preserve such rights; and
neither the maintenance of such system nor any such notification shall constitute the provision of
billable services for the purposes of determining whether there is an attorney -client relationship.
Termination will not affect the Client's responsibility for payment of outstanding statements and
accrued items incurred before termination or incurred thereafter in connection with an orderly
transition of matters. If we are retained and agree to perform further or additional services, our
attorney -client relationship will be revived, subject to these and any other supplemental terms of
engagement. The fact that we may inform the Client from time to time of developments in the
law which may be of interest, by newsletter or otherwise, should not be understood as a revival
of an attomey-client relationship. Moreover, we have no obligation to inform the Client of such
developments in the law unless we are engaged in writing to do so.
10. Tax Reportin .
The Internal Revenue Code, Treasury Regulations and published guidance provide rules which
require taxpayers engaging in certain types of transactions to disclose their participation in the
transactions to the Internal Revenue Service. If we determine that a transaction that is a subject
of our engagement is or may be covered by these regulations, we will advise the Client with
respect to any reporting obligations it may have, including with respect to comparable state tax
rules of which we are aware.
Exhibit A — Page 5
AMECURRENT 702035028.1063
Furthermore, such rules may require us to report to the Internal Revenue Service various aspects
of transactions with respect to which we act as the Client's tax advisor. If we determine that a
transaction that is a subject of our engagement may require such reporting, we will file the
appropriate forms with the Internal Revenue Service, and applicable state department of revenue,
and inform the Client that we will so file.
Such rules may also require us to maintain investor lists with respect to certain types of
transactions. These lists must contain specified information about the parties involved and the
federal tax and financial aspects of a covered transaction, including information that may
otherwise be protected from disclosure under state confidentiality rules or the attorney -client
privilege. The rules also require us to make the investor lists available to the Internal Revenue
Service if it so requests. If we determine that an investor list must be maintained with respect to a
transaction that is a subject of our engagement, we will do so, and we will request from the
Client any information required to be included in the list. If, however, the IRS requests that we
make such an investor list available, we will do so only after endeavoring to provide the Client
with an opportunity to assert any reasonable claim of attomey-client privilege with respect to the
information contained in the list. In the case of comparable applicable state tax rules of which we
are aware, we will act in a similar manner.
11. Standards of Professional Conduct.
Pursuant to Part 205 in Title 17 of the Code of Federal Regulations ("Standards of Professional
Conduct"), if any attorney of the Firm represents the Client in appearing and practicing before
the Securities and Exchange Commission (the "SEC"), the Firm may have obligations imposed
on it as further described in the Standards of Professional Conduct. These obligations currently
are limited to up -the -ladder reporting within the Client, although some form of reporting to the
SEC may be adopted. The Client acknowledges that one or more of our attorneys may currently
represent, or in the future may represent, the Client in appearing and practicing before the SEC
and understands, therefore, that we thereby become subject to the obligations imposed on us by
the Standards of Professional Conduct.
12. Insurance Covera2e and Notification of Insurers.
Unless the Firm specifically agrees in writing to the contrary, the Firm will not be responsible
for: (a) reviewing the Client's insurance policies, whether providing primary or excess coverage,
to determine if there may be coverage for any claim made against the Client or for fees and costs
that the Client incurs in any matter; or (b) notifying the Client's insurers or re -insurers about any
matter.
13. No Waiver of the Firm's Privileee.
The Firm represents many clients and handles a great number of complex matters. As a result
thereof, from time to time issues may arise that raise questions under attorneys' professional
conduct rules, including possible disputes with a client and conflicts of interest issues. When
such issues arise, we generally seek the advice of our Claims Counsel, Professional
Responsibility Partner or General Counsel. We consider such consultations to be protected from
disclosure under the attomey-client privilege. While some courts have limited this privilege
ANECURRENT 702035028.1063 Exhibit A — Page 6
under certain circumstances, we believe that it is in both our clients' and the Finn's interest that
we receive expert analysis of our obligations. Accordingly, as part of our agreement concerning
our representation, the Client agrees that if the Firm determines, in its own discretion, it is either
necessary or appropriate to consult with its counsel (either the Firm's Claims Counsel,
Professional Responsibility Partner or General Counsel or, if it chooses, outside counsel), the
Firm has the Client's consent to do so and the Client farther agrees that the Firm's on -going
representation of the Client shall not result in a waiver of any attomey-client privilege that the
Finn may have to protect the confidentiality of the Firm's communications with such counsel.
14. Third Party Expens
In connection with the legal services we provide, it may become necessary for the Firm to obtain
assistance and/or services from vendors, local counsel, experts and/or other third parties ("Third
Party Servicers"). When possible, the Client agrees to contract directlyMth any such Third Party
Servicer. In the event that the Firm engages a Third Party Servicer on behalf, or for the benefit,
of the Client or jointly with the Client, the Client agrees that (a) the Firm and/or Client will
instruct the Third Party Servicer to look solely to the Client and not the Firm for any payments
owing to said Third Party Servicer or (b) the Client will provide currently available funds to the
Firm in the amount of any approved outstanding Third Party Servicer invoice prior to the time
that payment of such invoice to the Third Party Servicer is due. Notwithstanding the above, if the
Firm does advance or pay any Third Party Servicer expense on behalf, or for the benefit, of the
Client, the Client agrees to reimburse the Firm promptly for any such expense. The agreements
in this Section 14 shall survive the termination of the attorney -client relationship.
15. Special English Firm Provisions.
If the Firm, as agent on the Client's behalf, engages the English Firm to work alongside the Finn
on a matter, such engagement shall be on the English Firm's standard terms of engagement
(which the English Firm refers to as "Our, Business Relationship"), a copy of which will be
provided upon request. Additionally, the following is called to the Client's attention:
The English Firm is an English limited liability partnership ("English LLP"), An English LLP
has "members" and not "partners". However, the English Finn's members have decided they
prefer to retain the title of "partner". Accordingly, the English Finn will continue to refer to its
members as partners in its dealings with the Client. As the English Firm is a limited liability
partnership, there is no contract between the Client and any individual employee, consultant or
partner of the English Firm. Any advice given to the Client by an employee, consultant or partner
is given by that person on behalf of the English Firm and that person will not assume any
personal liability to the Client for that advice. This will not, of course, limit or exclude the
liability of the English Firm for the acts or omissions of its employees, consultants or partners. If
you have any complaints or concerns about the English Firm's work, please raise these, in the
first instance, with a partner at the English Firm who will investigate your complaint promptly
and carefWly insure that the matter is handled in accordance with the English Firm's Complaints
Handling Protocol, a copy of which will be provided to the Client upon request.
Like many other law firms, the English Firm is not authorized under the Financial Services and
Markets Act 2000 (1117SMA") of the UK. This occurs because, as the English Film is a
Exhibit A — Page 7
AMECURRENT 702035029.1063
professional services firm which is regulated and supervised by a designated professional body
(i.e., the UK Law Society) and which does not conduct mainstream regulated activities, it
benefits from a specific exemption under FSMA which permits it to carry on regulated activities
which are reasonably regarded as a necessary part of its legal services. The English Firm's role is
to act as the Client's legal advisor in relation to the matters for which it has been engaged and it
is not part of its function to give financial or business advice on the merits of entering into any
particular transaction or to act as a broker or arranger of transactions. In providing its services,
the English Firm will assume that the Client's decision to negotiate and enter into any transaction
has been or will be made solely upon the basis of the Client's own evaluation. It is not part of the
English Firm's role to communicate to the Client or on its behalf invitations or inducements to
engage in investment activities. No communication from the English Firm, whether written or
oral and in whatever form it is received, is intended or should be construed as such an invitation
or inducement.
Under UK anti money laundering legislation, the English Firm, in common with all UK lawyers
and accountants and many financial institutions and other professional firms, is required to put in
place procedures to prevent money laundering and, in certain circumstances, where the English
Finn knows or suspects or has reasonable grounds for suspecting that a matter or transaction
involves money laundering, it is obliged to make a notification of its knowledge or suspicions to
regulatory authorities. The anti money laundering legislation also requires the English Firm to
identify its clients, and in some cases their beneficial owners, to conduct other background
checks and to retain records of the identification obtained. In some circumstances, it also may be
necessary for the English Finn to make inquiries as to the source of funds which are being used
in relation to a matter on which it advises. These requirements are known as "CIDID
requirements". The English Finn tries to meet these CDD requirements using information from
public sources. However, it may be necessary to provide (and permit the retention of�
information and documents to the Firm to pass onto the English Firm, including, in the case of
individuals, evidence of identity (such as a passport) and of home address (e.g., a utility bill). In
some cases, even where the Client is a corporation or other legal entity, the English Firm may be
required to obtain evidence of identity of directors or other principals. The English Firm is not
able to commence work and may decline to act if the CDD requirements have not been made to
its satisfaction.
R. 03/12
AMECURRENT 702035028.1063 Exhibit A — Page 8
OFFICE OF THE CITY CLERK
4305 Santa Fe Avenue, Vemon, Califomia 90058
Telephone (323) 583-8811
June 7, 2012
Mayer -Brown LLP
Attn: John Van de Kamp
350 South Grand Avenue
25th Floor
Los Angeles, CA 90071-1503
Re: Engagement Letter Agreement
Dear Mr. Van de Kamp:
Transmitted herewith is a fully executed copy of the original
engagement letter agreement as referenced above, approved
through Resolution No. 2012-79, on June 5, 2012.
If you have any questions regarding this matter, please call
Mark Whitworth at (323) 583-8811 ext. 398.
Ver trul -,-
I ARRDG.
City Clerk
WGY: dj
Enclosure
c: Mark Whitworth
Purchasing Department
Resolution No. 2012-79
Agreement File No. 12-046
Ex,clusive6i industfial
May 18,2012
Attn: City Administrator
City of Vernon
4305 Santa Fe Avenue
Vernon, CA 90058
Re: Representation by MUer Brown LLP
Dear Mr. Whitworth:
MAYER-BROWN
Mayer Brown LLP
350 South Grand Avenue
25th Floor
Los Angeles, California 90071-1503
Main Tel -1213 229 9500
Main Fax +1213 625 0248
�.rnayerbrown.mm
John K. Van de Kamp
Direct Tel +1213 229 9511
Direct Fax 2131576-8116
Ivandekamp@mayeibrom.com
We are pleased that you have asked John Van de Kamp and his firm, Mayer Brown LLP,
a limited liability partnership established in the United States (the "Finn"), to serve as an
Independent Reform Monitor (the "Monitor"). With this letter, we provide you with an
explanation of the representation and address (1) identification of our client; (2) scope of our
engagement; (3) conflicts of interest; and (4) fees, expenses and other charges. This letter, the
Standard Terms of Engagement that are attached as Exhibit A, and the attached Schedule of Non
Fee Charges to Clients govern our relationship.
1. Client. This engagement does not create an attorney -client relationship with the City
of Vernon or any of its representatives or employees, although Mayer Brown's costs of
representation will be reimbursed by the City of Vernon for payment to Mayer Brown.
2. Scope of Engagement. John Van de Kamp and Mayer Brown are engaged as an
Independent Reform Monitor to: (a) Assess and make recommendations regarding ongoing
compliance with the Political Reform Act of 1974, Government Code Section 1090, Brown Act,
Public Records Act and any other provisions of law governing conflicts of interest and/or
transparency in government; (b) make recommendations to the City reasonably designed to
improve and enhance the existing practices, procedures and policies governing conflicts of
interest and open government of the City, its departments, divisions, and governing bodies, and
(c) to review the City's governance reform measures and initiatives, and recommend measures
and initiatives in the best interest of the City.
The term of this agreement shall be for the period beginning May 14, 2012, and ending
February 15, 2016 subject to the termination provisions set forth in paragraph 5 herein.
Other than the Monitor's role as Vernon's Independent Ethics Advisor ending February
15, 2012, the Monitor has had no pre-existing relationship with the City of Vernon and shall
satisfy himself that he can be effective and impartial in the performance of the Monitor's duties.
The Monitor is, and shall remain at all times, an independent third -party, not an employee or
agent of the City of Vernon, and shall conduct his affairs accordingly. The Monitor shall
Mayer Brown LLP operates in combination with other Mayer Brown entities with offices in Europe and Asia
and is associated with Tauil & Chequer Advogados, a Brazilian law partnership.
AMECURRENT 702035028.1063
Mayer Brown LLP
Attn: City Administrator
May 18,2012
Page 2
perform his or her duties in a professionally independent and objective fashion, as appropriate to
the nature of the engagement.
The Monitor's duties and authority, and the obligations of the City of Vernon with
respect to the Monitor, are set forth below. All provisions defining the Monitor's jurisdiction,
powers, oversight authority and duties shall be broadly construed.
The Monitor shall:
a. Review and evaluate the effectiveness of the City of Vernon's internal controls,
record -keeping, internal audit, and existing or new reporting policies and procedures with respect
to the Political Reform Act of 1974, Government Code Section 1090, Brown Act, Public
Records Act and conflict of interest requirements.
b. Review and evaluate from a legal perspective the effectiveness of the City of
Vernon's policies and procedures relating to reimbursement of expenses and payment of invoices
to any individual affiliated with the City or the City Council, including City employees, and shall
make recommendations to the City regarding such policies.
C. Review and evaluate from a legal perspective the effectiveness of the City of
Vernon's policies for selecting, engaging and paying consultants, including the City of Vernon's
conflict of interest policies. The Monitor shall review the structure and content of the City of
Vernon's current consulting agreements, and payments made to consultants thereunder. The
Monitor shall also review any consulting agreements proposed during the term of this agreement
and recommend any alterations necessary to ensure the proposed consulting agreement complies
with all policies and procedures.
d. Review and evaluate from a legal perspective whether the City of Vernon has
adequate and appropriate policies pertaining to ethics and conflicts of interest. The Monitor shall
evaluate the extent of existing training and education and, where the Monitor deems appropriate,
make recommendations regarding additional training and education relating to ethics and
conflicts of interest.
e. Review the implementation of the measures recommended by the Independent
Ethics Advisor on July 29, 2011 and January 31, 2012, and those recommended by Senator
Kevin de Leon on August 22, 2011 and make recommendations regarding their implementation
and such other measures which may be called for which are in the best interest of the City.
The City of Vernon will cooperate fully with the Monitor. To that end, the City of
Vernon shall provide the Monitor with access to all non -privileged information, documents, and
records that relate to the responsibilities of the Monitor. The City of Vernon will further provide
the Monitor with access to all employees, consultants or Monitors and shall encourage ftill
cooperation with the Monitor.
AMECURRENT 702035028.1063
Mayer Brown LLP
Attn: City Administrator
May 18,2012
Page 3
The City of Vernon shall not be obligated to provide the Monitor with materials or
information protected by the attorney -client privilege or work product doc trine. The Monitor
shall where necessary take appropriate steps to maintain the confidentiality of any information
entrusted to him. The Monitor will undertake to avoid disruption of the City of Vernon's
ordinary operations.
The Monitor shall have the power to conduct audits of all city operations and budgets as
well as the power to review any proposed service contract that is substantial in nature.
The Monitor may, at the City of Vernon's expense, select and hire outside legal counsel,
consultants, investigators, auditors, experts or other professionals to work under his direction for
the proper discharge of the Monitor's duties. Before retention, the Monitor shall provide to the
City Administrator a notice of the retention and a proposed budget for their retention. The City
Administrator shall not withhold reasonable retention requests: if the City Administrator and/or
the City Counsel finds such requests unreasonable, such findings shall be communicated to the
Monitor no later than 15 days after submission of the retention and the budget proposal, and
permit the Monitor to submit an alternative proposal.
On or before July 31, 2012, the Monitor shall issue an written report to the City
Administrator and City Council and the state legislature detailing the Monitor's findings and
recommendations, if any, designed to improve the City of Vernon's internal controls, policies
and procedures. The Monitor shall issue such a report every 6 months, i.e., shall be issued by
January 31 and July 31 of each year of this contract.
Within forty-five (45) days after receiving the reports, the City Administrator and City
Council shaH advise the Monitor in writing of any recommendations that the City Administrator
and City Council consider unduly burdensome, impractical, costly or which would otherwise
impair the day-to-day operation of the City. With respect to any recommendation made by the
Monitor that is not adopted by the City Administrator and City Council, the City Administrator
and City Council shall propose in writing an alternative policy, procedure or system designed to
achieve the same objective or purpose.
The Monitor shall undertake follow-up reviews during the term of this retention as
reasonably deemed necessary and appropriate.
In order for the Monitor to fulfill his obligation, the City Administrator shall provide
adequate office space for the Monitor and his staff to conduct its on site work.
The Monitor's assignment may be expanded at the express direction of the City of
Vernon's City Administrator and/or City Council.
AMECURRENT 702035028.1063
Mayer Brown LLP
Attn: City Administrator
May 18, 2012
Page 4
3. Loyalty and Conflicts ofInterests.
City of Vernon agrees that the Monitor is independent and that this shall not preclude
Mayer Brown LLP from representing either existing or future clients in other matters.
Clients with Conflicting Interests. During or after the time we are engaged in this matter,
some other current or future client may ask us to represent it in connection with some dispute,
transaction, litigation, arbitration or other matter that is not substantially related to this
engagement in which the interests of such client may be directly adverse to your interests. You
agree that, consistent with the California Rules of Professional Conduct (the "Rules") and the
California Business and Professions Code, Mayer Brown LLP may continue, or in the future
undertake, to represent any existing or new client in any such matter, provided that such
representation is not substantially related to this engagement.
Agreement to Firm's Consultation with Lawyers and Experts. In addition, in the course
of this engagement, and in order fully to satisfy our professional obligations, we may from time
to time need to consult with the lawyers in this firm or outside lawyers or experts retained by the
firm responsible for advising the firm on issues of professional ethics and responsibility,
including issues that may implicate your interests. You acknowledge and agree that,
notwithstanding the potential for conflict in our consideration of our professional obligations, the
firm is free to consult with such counsel or experts at its own expense on such matters consistent
with the firm's obligations under the applicable rules of professional conduct.
4. Fees, Expenses and Other Charges.
Fees. Our fees for professional services in connection with this engagement will
generally reflect, and be determined primarily on the basis of, the hours worked by Mayer Brown
attorneys and paralegals and the hourly rates in effect at the time the services are rendered shall
not exceed $550 per hour. However, if the cost of living index C'CPI") increases 15% as
measured from February 15, 2012, the rate will be increased by that level (15%), upon notice to
The City. No further increases will sought during the duration of the engagement. John Van de
Kamp who will be the primary Mayer Brown attorney working on this matter has a billing rate of
$550 per hour. Partners and associates will be used as needed and are charged at rates ranging
from $300-$525 per hour. Paralegals are charged at the rate of no more than $200 per hour. The
minimum billing unit for this representation is .25 of an hour. The amount of our fee takes into
account all relevant circumstances and factors as set forth in the Rules as it applies to us as
attorneys, including the nature of the services performed, the amount of time spent, the
experience and ability of the lawyers and paralegals working on this engagement, the novelty
and complexity of the specific issues involved, the time limitations imposed by you or the
circumstances and the responsibilities undertaken by us.
Expenses and Other Charges. During the course of the engagement, the City of Vernon
will also be responsible for all expenses and service charges relating to our engagement, whether
billed directly by us or by individuals or entities retained by us. Mayer Brown's expenses and
AMECURRENT 702035028.1063
Mayer Brown LLP
Attn: City Administrator
May 18,2012
Page 5
other charges are listed in Attachment A. Unless special arrangements are made, the fees,
expenses and charges of others (such as experts, investigators, local counsel, consultants and
document service providers who are expected to be primarily from the L.A. area) and other large
disbursements will not be paid by us, but will be the sole responsibility of, and billed directly to,
City of Vernon. These bills will be reviewed and approved by the Monitor. Any expenses for
travel outside of Los Angeles County or travel expenses in excess of $150 must be approved in
advance by the City of Vernon.
Billing and Payment. In the normal course, you will receive on a monthly basis a
confidential statement of professional services rendered and expenses and service charges
incurred during the preceding month. Mayer Brown will bill City of Vernon directly.
We expect that our statements will be paid promptly upon receipt by the City of Vernon,
and in any event within 30 days after the invoice date. If you have any questions or comments
concerning our services or charges during the course of our representation, please bring them to
my attention so that any problems can be quickly resolved.
5. Indemnification. City of Vernon agrees to indemnify the Monitor and the Firm
from and against any and all losses, claims, damages and liabilities, joint or several, to which the
Monitor and the Firm may become subject under any applicable Federal or state law, or
otherwise, and related to or arising out of the engagement of the Monitor and the Firm pursuant
to, and the performance by the Monitor and the Firm of the services contemplated by, this
Agreement and will reimburse the Monitor and the Finn for all reasonable expenses (including
counsel fees and expenses) as they are incurred in connection with the investigation of,
preparation for or defense of any pending or threatened claim or any action or proceeding arising
therefrom, whether or not the Monitor and/or the Firm is party and whether or not such claim,
action or proceeding is initiated or brought by or on behalf of City of Vernon. City of Vernon
also agrees that the Monitor and the Firm shall have no liability (whether direct or indirect, in
contract or tort or otherwise) to the City of Vernon or its security holders or creditors related to
or arising out of the engagement of the Monitor and the Firm pursuant to, or the performance by
the Monitor and the Firm of the services contemplated by, this Agreement except to the extent
that any loss, claim, damage or liability is found in a final judgment by a court to have resulted
from the Monitor's bad faith or gross negligence.
City of Vernon agrees that, without the Monitor's and the Firm's prior written consent, it
will not settle, compromise or consent to the entry of any judgment in any pending or threatened
claim, action or proceeding in respect of which indemnification could be sought under the
indemnification provision in this letter agreement (whether or not the Monitor and/or the Firm
are an actual or potential party to such claim, action or proceeding), unless such settlement,
compromise or consent includes an unconditional release of the Monitor and the Firm from all
liability arising out of such claim, action or proceeding.
In the event that the Monitor is requested to appear as a witness in any action brought by
or on behalf of or against City of Vernon or any City of Vernon affiliate in which the Monitor is
AMECURRENT 702035028.1063
Mayer Brown LLP
Attn: City Administrator
May 18,2012
Page 6
not named as a defendant, including by subpoena duces tecurn City of Vernon agrees to
reimburse the Monitor and the Firm for all reasonable expenses incurred by him in connection
with the Monitor's appearing and preparing to appear as such a witness, including, without
limitation, the fees and disbursements of his outside legal counsel, and to compensate the
Monitor and the Firm at the hourly rate the Monitor is compensated pursuant to this Agreement.
City of Vernon's obligations under this section, "Indemnification", will survive any
termination of this Agreement. For avoidance of doubt, the obligations set for this section apply
to John Van de Kamp, the Firm, and any partner, employee or other person working for and with
Mayer Brown in connection with this engagement.
6 Term of Engagement. The City of Vernon has the right to terminate our
engagement at any time for cause or upon the death or incapacitation of John Van de Kamp,
upon written notice, and all outstanding charges will become due at that time. We reserve the
right to withdraw from the engagement at any time consistent with the rules of professional
conduct. We may also suspend or terminate work on behalf of a client that does not pay our
statements within 90 days after they are rendered. Our right to withdraw as Monitor shall, of
course, be consistent with the applicable provisions of the Rules.
Upon the termination of this engagement, we will either make arrangements to return to
you, or by your direction to the Vernon City Attorney, all copies or originals of documents or
materials belonging to you or otherwise constituting your records, store them at the City of
Vernon's expense or dispose of them. You agree that we may keep copies of such files if we so
choose. You also agree that our own internal files (including but not limited to firm
administrative records, time and expense reports, personnel and staffing materials, accounting
records and related documents) and attorney work product (including without limitation drafts,
notes, legal memoranda, and other legal and factual research reflecting our opinions and mental
impressions) pertaining to this matter are our property and will not be delivered to you at the
conclusion or upon the termination of our engagement, except that the City of Vernon shall be
entitled to any final research memoranda, and also to any documents supplied by third parties.
Governing Law. Our engagement shall be governed by, and construed in accordance
with, the laws of the State of California, exclusive of the law of conflicts of laws.
If a dispute develops about our fees, the City.of Vernon may be entitled under Section
6200, et seq., of the California Business and Professions Code to arbitration of that dispute.
All actions or proceedings arising out of or relating to this engagement (other than those
to which Section 6200 et seq. applies) shall be heard and determined in California state or federal
court sitting in the County of Los Angeles, to whose jurisdiction all parties to this engagement
letter irrevocably and exclusively submit. In connection with any such proceeding, you and the
City of Vernon irrevocably waive to the fullest extent permitted by law, any defense of forum
non conveniens. You also irrevocably agree that service of process may be made on the City of
Vernon by service of a copy of the summons and complaint by certified mail to Vernon's City
AMECURRENT 702035028.1063
Mayer Brown LLP
Attn: City Administrator
May 18,2012
Page 7
Attorney by certified mail to the Office of City Attorney, 4305 Santa Fe Avenue, Vernon, CA
90058. Nothing herein shall limit the right of the parties to stipulate and agree to submit any
dispute to binding arbitration in lieu of litigation.
The terms of this engagement can be modified only by written agreement of all the
parties hereto.
If the foregoing correctly reflects the terms and conditions of our engagement, please
indicate your acceptance by executing the enclosed copy of this letter in the space provided
below and return it to our office. The effective date of our engagement will be the date on which
our service commenced.
We are delighted that we will have the opportunity to work with you on this matter. If
you have any questions about the terms of our engagement, please do not hesitate to give me a
call. We are very much looking forward to working with you and your colleagues.
If you have any questions, please call me. Otherwise please sign and return the enclosed
copy of this letter.
Very truly yours,
MAYER BROWN LLP
AGREED:
By: William Davis
Its: Mayor Pro-Tem
Date:
Enclosures
cc: John Mathews
AMECURRENT 702035028.1 063
Mayer Brown LLP
U. S. Offices
Schedule of Non -fee Charges to Clients
July, 2011
I. Loniz Distance Telephone.
We purchase our long-distance telephone service from telecommunications providers at
discounted rates. We charge clients at rates calculated to recover our cost.
Ii. Automated Research.
We purchase services from Lexis and Westlaw at fixed monthly rates which are substantially
below their published rates. We charge clients for the Lexis and Westlaw connections at rates
calculated to recover our cost.
111. Telefax Service.
We charge clients $ 1.00 per page, plus applicable long distance telephone charges regardless of
length at our discounted rates. There is no charge for incoming telefaxes.
IV. Document Reproduction.
We charge clients for standard -size internal black and white copies at the rate of $.15 per page.
We charge clients for standard -size internal color document reproduction (if specifically
requested by clients) at the rate of $ 1.00 per page. We currently reproduce documents using
photocopiers, laser printers, and digital copiers, and may in the future use other means of
reproduction. Outside copying is charged at actual out-of-pocket cost.
V. Secretarial, Word Processing and Proofreadina Services.
We accrue for client accounts document preparation charges at the rate of $ 100 per hour for
word processors and secretaries generally when documents (originals or amendments) of over 10
pages are prepared or for secretarial overtime. Proofreading services accrue at the rate of $120
per hour.
AMECURRENT 702035028.1063
VI. MUer Brown Provided Electronic Discovery Services.
To the extent that the Client elects to host electronic discovery information on the Firm's
Electronic Discovery Services ("EDS") servers, we charge a monthly comprehensive services fee
for hosting and supporting that data. We calculate this charge for each month based on the data
volume residing on the EDS servers at the end of such month, at a rate of $65 per gigabyte
("GB"), which covers EDS department expenses relating to that internally supported data,
including any hosting expenses, processing, handling, and response to case team or Client needs.
VII. Postage.
We charge clients at cost for postage when the cost of mailing is $ 1. 00 or more.
VIII. Out-of-pocket Disbursements.
The following types of disbursements when related to a client matter are charged at the firm's
cost:
Advances on behalf of clients (e.g., tax payments, filing fees, title
charges)
Consultants' and expert witnesses' fees and expenses
Courier and messenger services
Court reporters
Equipment when purchased solely for a client matter
Meals
Outside services (including cost of litigation support services
purchased from outside vendors)
Service of process
Records searches
Supplies (when amounts are large or type of supply item is special)
Tax return processing charges
Taxis, mileage, parking (local)
Travel (airfares, hotels, meals, car rentals, fees of travel agencies
and professionals, taxis and incidentals)*
Trial exhibits
Witness fees and costs
Other items not covered above that are directly attributable to a
client matter
-2-
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*When our independent travel agency of record is used to book
airfare there is a fee charged of not more than $32 per
reservation to reduce the cost of the Travel Department.
IX. Items Not Charged to Clients.
Administrative overhead
Air conditioning and electricity for overtime work
Client entertainment
Local and suburban telephone calls
Rent for conference rooms
-3-
AMECURRENT 702035028.1063
EXHIBIT A
MAYER BROWN LLP
STANDARD TERMS OF ENGAGEMENT
Governing Terms.
This Standard Terms of Engagement sets forth our standard terms of engagement as your
lawyers. Unless modified in writing by mutual written agreement, these terms are an integral part
of your engagement of our Firm (as hereinafter defined). Our employment on your behalf is
limited to those specific matters which we agree to undertake.
Mayer Brown is a global legal services organization comprising legal practices which are
separate entities ("Mayer Brown Practices"). The Mayer Brown Practices are: Mayer Brown
LLP, a limited liability partnership established in the United States (the "Firm"); Mayer Brown
International LLP, a limited liability partnership incorporated in England and Wales (the
"English Fi "); Mayer Brown Europe -Brussels LLP, a limited liability partnership established
in the United States (the "Brussels Firm"); Mayer Brown, a SELAS established in France (the
"French SELAS..); Mayer Brown JSM, a Hong Kong partnership, and its associated entities in
Asia; and Tauil & Chequer Advogados, a Brazilian partnership with which Mayer Brown is
associated. These terms govern the relationship between the Firm and the "Client", as defined in
the letter to which these terms are attached ("Cover Letter'). The Cover Letter and these
Standard Terms of Engagement, together with all undertaking letters, constitute the entire
understanding between the Firm and the Client, and supersede all prior understandings, written
or oral, relating to our engagement. Any change must be made or confirmed in writing by the
Firm and the Client.
The Client agrees that in connection with any undertaking the Firm may, where appropriate, as
agent on the Client's behalf, engage another Mayer Brown Practice to work alongside the Finn
on a matter upon its standard terms of engagement, a copy of which will be supplied to the Client
upon request. The Client will not, however, be a client of another Mayer Brown Practice unless
the Firm has engaged it as described above or the Client has entered into an agreed engagement
directly with it.
Unless the Firm has otherwise specifically agreed with the Client, the Client agrees that the Firm
may disclose that it represents the Client, including in materials which the Firm uses to describe
its practices and expertise.
I . Fees.
The Client agrees to pay the fees and other charges billed by the Firm, and, where appropriate,
the other Mayer Brown Practices. The Firm's fees for services generally are based on time (in
quarter hour increments, except if our fees require bankruptcy court approval they may have to
be recorded to the nearest tenth of an hour) spent on specific projects, computed at our hourly
rates for those persons performing the services. Hourly rates are all subject to adjustment by the
Firm from time to time. If contract, or independent contractor, lawyers or paralegals are assigned
to work on any matter which the Firm undertakes on behalf of the Client, whether or not they are
employed through an independent agency, the Firm will charge the Client hourly rates based
upon its then from time to time hourly rates for Firm lawyers and paralegals with similar
AMECURRENT 702035028.1063
qualifications and experience. After consultation, we also may take into account additional
factors in performing our services in connection with any matter, such as unusual time
limitations, particularly favorable results obtained, the unusual level of skill required, the
efficiency with which the services were performed and other relevant considerations. Other
charges for which we will bill are described on the enclosed current schedule of charges, which
is subject to adjustment from time to time. Any estimate of the fees and other charges that may
be incurred in connection with the services we will provide on any matter is not a fixed or
maximum fee and does not constitute a commitment by us to perform the described services for
that amount, or an obligation to pay that amount. We anticipate submitting a monthly invoice for
the professional services (including lawyers and paralegals) rendered and other charges and
expenses incurred in connection with each matter we are handling. Payment is due upon receipt
of our statement and in no event later than 30 days thereafter. We reserve the right to charge
interest on amounts overdue at 2% over the prime rate in effect from time to time as published in
The Wall Street Journal. The Client may at any time request details regarding any matter,
specifying the individuals involved, their positions, the hours and work performed and an
itemization of other charges. If we agree in writing to look first to the Client's customer or
insurer to pay our fees and charges, the Client nonetheless guarantees such payment will be made
within 30 days. Fees and other charges incurred in connection with our representation are not
contingent upon the successful completion of any project.
Without limiting any other provision of this Section 1, the Client agrees to compensate the Firm
at its hourly rates (which, as described above, are subject to adjustment from time to time) for
activities incidental to representing the Client, whether during or after the termination of the
attorney -client relationship, including, without limitation, in connection with responding to
subpoenas, searching for and producing documents and preparing for testimony and testifying,
and otherwise preparing for, and responding to, the Client's requests or third party claims or
actions relating to a matter the Firm is handling, or has handled, for the Client. The Client also
agrees to pay, or reimburse the Firm for the payment of, all reasonable expenses and other
charges in connection with such incidental activities, including, without limitation, the fees of
outside counsel retained by the Firm.
2. New York Office, Houston Office.
In the event the Client has a fee dispute with us in an amount that is between $1,000 and
$50,000, it may have the right to seek resolution of that dispute in an arbitration under Part 137
of the Rules of the Chief Administrator, New York State Office of Court Administration. For
ftirtber information about the fee dispute arbitration procedures, please refer to the text of Part
137, available on the internet at www.coui-ts.state.Liy.us/admin/feedispqte.
NOTICE TO CLIENTS: The State Bar of Texas requires us to inform you that it prosecutes
professional misconduct committed by Texas attorneys. Although not every complaint against or
dispute with a lawyer involves professional misconduct, the State Bar's Office of Chief
Disciplinary Counsel will provide you with information about how to file a complaint. Please
call 1-800-932-1900 toll -free for more information.
Exhibit A — Page 2
AMECURRENT 702035028.1063
3. Confidentiality
We will keep confidential any information identified by the Client as being confidential and
which the Client provides to us, except as required or authorized by law or as necessary in our
judgment to perform the services we have been engaged to perform. The Client agrees that we
may disclose confidential information to other Mayer Brown Practices. The other Mayer Brown
Practices have agreed to keep such information confidential, subject, however, to the
requirements of law and regulations, the professional rules governing their conduct and their
respective standard terms of engagement.
4. Conflicts.
The Client agrees that the Firm may represent other persons or entities in matters not
substantially related to matters we are handling for the Client, even though those persons or
entities are, or have interests that are, adverse (whether in transactions, bankruptcy, litigation,
arbitration or other adverse proceedings or otherwise) to the Client or its interests.
We agree, however, that the Client's consent to adverse representation shall not apply in any
instance where, as a result of our representation of the Client, we have obtained sensitive,
proprietary or other confidential information of a non-public nature that, if known to any such
other client of ours, could be used in a matter in which we are retained by our other client to the
Client's material disadvantage unless we have screened our lawyers and paralegals who have
such information from any involvement in the adverse representation.
5. Affiliates.
For the purpose of determining whether a conflict of interest exists, it is only the Client which we
will represent and not its stockholders, subsidiaries or related entities ("affiliates"). The Client
agrees not to give us confidential information regarding its affiliates. While we recognize that to
act adversely to any affiliate could jeopardize a long-term relationship with the Client, which we
would naturally be reluctant to do, for conflict of interest purposes we reserve the right to
represent another client with interests adverse to any affiliate without obtaining any consent from
the Client or its affiliates.
6. Financial Transactions.
Our engagement for any financing transactions for a financial institution will consist solely of
assisting it with the legal aspects of negotiating, documenting and closing of financings, and, if
specifically requested, conducting a legal review (the scope of which will be defined at the
commencement of each transaction) of certain due diligence matters pertaining to each
prospective financed party. We will assume, without independent verification, that each party
exists and is in good standing, that the financing transaction is within the respective parties'
powers and authority, is duly authorized by each of the respective parties and does not violate
their respective constituent documents or any of their respective agreements, that all signatures
and documents are genuine and that all persons executing documents have the legal capacity to
contract. We also will assume, without independent verification, that each financed party is in
compliance with applicable laws and regulations and the financing contracts are enforceable
against each financed party in accordance with their respective terms. Unless otherwise
Exhibit A — Page 3
AMECURRENT 702035028.1063
specified, in reliance upon the related warranties of the financed parties and the assumptions set
out above, we will satisfy ourselves that the financing contracts are, under the relevant state law,
valid, subject to customary qualifications for bankruptcy and general principles of equity
(including concepts such as good faith and fair dealing and commercial reasonableness) and also
subject to the qualification that certain rights set forth in such contracts may not be specifically
enforceable but that such rights as are enforceable are sufficient, taken as a whole, for the
practical realization of the essential legal benefits intended by such contracts.
In connection with the representation of any financial institution, as we are not counsel with
respect to general corporate compliance matters, we will not undertake any responsibility for
assuring that, with respect to financing transactions, the Client will be complying with applicable
state, local or federal laws and regulations because of its legal or regulatory status or because of
the general nature of its business, including, without limitation, any prudential considerations,
capital adequacy requirements, lending limits, restrictions on affiliate and insider transactions,
loan -to -value limitations, tying of products or services, appraisal requirements, rules regarding
interlocking boards of directors, governmental reporting and licensing requirements, and federal,
state or local tax matters.
Whether or not our client is a financial institution, unless we otherwise agree in writing, we do
not: (a) make or cause to be made searches of filing or recording systems; (b) ensure that the
initial filings or recordings of security documents are made; (c) undertake responsibility for
advising the Client upon or ensuring compliance with periodic refiling or re-recording
requirements; (d) opine as to matters relating to the existence of or title to any collateral or the
priority of any liens or security interests.
7. Associations.
In cases where the Client is a trade association or the like, the sole Client is such association and
not any of its individual members or any other persons or entities whose interests are represented
by those members.
8. Joint ReDresentation.
If representing the Client consists of our representation of multiple parties, there may be issues
where there are conflicting or potentially conflicting interests. If there is a disagreement on any
issue, the Firm asks that differences be resolved without our assistance. If those differences
cannot be resolved, we will not represent any party as to that issue. If the differences are serious
enough, we may determine that it is appropriate for us to withdraw from the matter completely.
Each party in a joint representation is separately, jointly and severally responsible for the full
payment of our bills even though the parties may have agreed among themselves to bear only a
proportionate share. In the case of any joint representation, the parties haveagreed there will be
no confidences among them regarding the work we do for them or any confidentiality among
them with respect to communications or information received from any of the parties. If we
receive information from or about one party that we believe others should have in order to make
decisions regarding the subject of our representation, we shall give them that information; and
the attomey-client privilege may not be available with respect to communications to or from any
of the parties and our Finn. In cases where the Client is a joint venture, we will only represent
Exhibit A — Page 4
AMECURRENT 702035028.1063
that joint venture and we do not represent the venturers. Such representation does not constitute a
"joint representation7.
9. Termination.
Upon the Client's request received at -the termination of the attorney -client relationship, its
papers and physical property ("Client Propgjdy') will be returned to the Client. We reserve the
right to destroy or otherwise dispose of any Client Property in our possession after 90 days after
the termination of the attomey-client relationship. The Firm files, including attorney work
product, pertaining to the Client, will be retained, stored or destroyed by us in accordance with
our then effective policies and procedures.
Either the Client or the Firm may terminate the attorney -client relationship at any time for any
reason by written notice, subject on our part to the applicable rules of professional conduct.
Unless otherwise terminated, our attomey-client relationship will be considered terminated at the
earlier of our completion of the specific services for which we have been retained and 12 months
after the last date the Firm furnished any billable services. If the attorney -client relationship has
been, or is deemed to have been, terminated pursuant to either of the foregoing sentences, the
fact that the Firm or one or more persons associated with the Firm may be identified as a
recipient of (and, in fact, may receive) notice on behalf of the Client shall not negate such
termination nor constitute the continuation or revival, or evidence the continuation or revival, of
the attomey-client relationship. The Firm may maintain a system to calendar due dates for the
payment of maintenance and/or annuity fees relating to, or the renewal dates for the preservation
of certain legal rights attaching to, intellectual property. In connection therewith it may notify the
person or entity listed in the Firm's records as the holder of such rights of the necessity of paying
maintenance and/or annuity fees or obtaining a renewal in order to preserve such rights; and
neither the maintenance of such system nor any such notification shall constitute the provision of
billable services for the purposes of determining whether there is an attomey-client relationship.
Termination will not affect the Client's responsibility for payment of outstanding statements and
accrued items incurred before termination or incurred thereafter in connection with an orderly
transition of matters. If we are retained and agree to perform further or additional services, our
attorney -client relationship will be revived, subject to these and any other supplemental terms of
engagement. The fact that we may inform the Client from time to time of developments in the
law which may be of interest, by newsletter or otherwise, should not be understood as a revival
of an attomey-client relationship. Moreover, we have no obligation to inform the Client of such
developments in the law unless we are engaged in writing to do so.
10. Tax Reporting.
The Internal Revenue Code, Treasury Regulations and published guidance provide rules which
require taxpayers engaging in certain types of transactions to disclose their participation in the
transactions to the Internal Revenue Service. If we determine that a transaction that is a subject
of our engagement is or may be covered by these regulations, we will advise the Client with
respect to any reporting obligations it may have, including with respect to comparable state tax
rules of which we are aware.
Exhibit A — Page 5
AMECURRENT 702035028.1063
Furthermore, such rules may require us to report to the Internal Revenue Service various aspects
of transactions with respect to which we act as the Client's tax advisor. If we determine that a
transaction that is a subject of our engagement may require such reporting, we will file the
appropriate forms with the Internal Revenue Service, and applicable state department of revenue,
and inform the Client that we will so file.
Such rules may also require us to maintain investor lists with respect to certain types of
transactions. These lists must contain specified information about the parties involved and the
federal tax and financial aspects of a covered transaction, including information that may
otherwise be protected from disclosure under state confidentiality rules or the attomey-client
privilege. The rules also require us to make the investor lists available to the Internal Revenue
Service if it so requests. If we determine that an investor list must be maintained with respect to a
transaction that is a subject of our engagement, we will do so, and we will request from the
Client any information required to be included in the list. If, however, the IRS requests that we
make such an investor list available, we will do so only after endeavoring to provide the Client
with an opportunity to assert any reasonable claim of attomey-client privilege with respect to the
information contained in the list. In the case of comparable applicable state tax rules of which we
are aware, we will act in a similar manner.
11. Standards of Professional Conduct.
Pursuant to Part 205 in Title 17 of the Code of Federal Regulations ("Standards of Professional
Conduct"), if any attorney of the Firm represents the Client in appearing and practicing before
the Securities and Exchange Commission (the "LEC"), the Firm may have obligations imposed
on it as further described in the Standards of Professional Conduct. These obligations currently
are limited to up -the -ladder reporting within the Client, although some form of reporting to the
SEC may be adopted. The Client acknowledges that one or more of our attorneys may currently
represent, or in the future may represent, the Client in appearing and practicing before the SEC
and understands, therefore, that we thereby become subject to the obligations imposed on us by
the Standards of Professional Conduct.
12. Insurance Coverage and Notification of Insurers.
Unless the Finn specifically agrees in writing to the contrary, the Firm will not be responsible
for: (a) reviewing the Client's insurance policies, whether providing primary or excess coverage,
to determine if there may be coverage for any claim made against the Client or for fees and costs
that the Client incurs in any matter; or (b) notifying the Client's insurers or re -insurers about any
matter.
13. No Waiver of the Firm's Privileize.
The Firm represents many clients and handles a great number of complex matters. As a result
thereof, from time to time issues may arise that raise questions under attorneys' professional
conduct rules, including possible disputes with a client and conflicts of interest issues. When
such issues arise, we generally seek the advice of our Claims Counsel, Professional
Responsibility Partner or General Counsel. We consider such consultations to be protected from
disclosure under the attorney -client privilege. While some courts have limited this privilege
Exhibit A — Page 6
AMECURRENT 702035028.1063
under certain circumstances, we believe that it is in both our clients' and the Firm's interest that
we receive expert analysis of our obligations. Accordingly, as part of our agreement concerning
our representation, the Client agrees that if the Firm determines, in its own discretion, it is either
necessary or appropriate to consult with its counsel (either the Firm's Claims Counsel,
Professional Responsibility Partner or General Counsel or, if it chooses, outside counsel), the
Firm has the Client's consent to do so and the Client further agrees that the Firm's on -going
representation of the Client shall not result in a waiver of any attorney -client privilege that the
Firm may have to protect the confidentiality of the Firm's communications with such counsel.
14. Third Party Expense.
In connection with the legal services we provide, it may become necessary for the Firm to obtain
assistance and/or services from vendors, local counsel, experts and/or other third parties ("Third
Party Servicers"). When possible, the Client agrees to contract directly with any such Third Party
Servicer. In the event that the Firm engages a Third Party Servicer on behalf, or for the benefit,
of the Client or jointly with the Client, the Client agrees that (a) the Firm and/or Client will
instruct the Third Party Servicer to look solely to the Client and not the Finn for any payments
owing to said Third Party Servicer or (b) the Client will provide currently available funds to the
Firm in the amount of any approved outstanding Third Party Servicer invoice prior to the time
that payment of such invoice to the Third Party Servicer is due. Notwithstanding the above, if the
Firm does advance or pay any Third Party Servicer expense on behalf, or for the benefit, of the
Client, the Client agrees to reimburse the Firm promptly for any such expense. The agreements
in this Section 14 shall survive the termination of the attomey-client relationship.
15. Special English Firm Provisions.
If the Firm, as agent on the Client's behalf, engages the English Firm to work alongside the Firm
on a matter, such engagement shall be on the English Firm's standard terms of engagement
(which the English Firm refers to as "Our, Business Relationship"), a copy of which will be
provided upon request. Additionally, the following is called to the Client's attention:
The English Firm is an English limited liability partnership C'English LLP'). An English LLP
has "members" and not "partners". However, the English Finn's members have decided they
prefer to retain the title of "partner". Accordingly, the English Finn will continue to refer to its
members as partners in its dealings with the Client. As the English Firm is a limited liability
partnership, there is no contract between the Client and any individual employee, consultant or
partner of the English Firm. Any advice given to the Client by an employee, consultant or partner
is given by that person on behalf of the English Finn and that person will not assume any
personal liability to the Client for that advice. This will not, of course, limit or exclude the
liability of the English Firm for the acts or omissions of its employees, consultants or partners. If
you have any complaints or concerns about the English Firm's work, please raise these, in the
first instance, with a partner at the English Firm who will investigate your complaint promptly
and carefully insure that the matter is handled in accordance with the English Firm's Complaints
Handling Protocol, a copy of which will be provided to the Client upon request.
Like many other law firms, the English Firm is not authorized under the Financial Services and
Markets Act 2000 ("FSM ") of the UK. This occurs because, as the English Firm is a
Exhibit A — Page 7
AMECURRENT 702035029.1063
professional services firm which is regulated and supervised by a designated professional body
(i.e., the UK Law Society) and which does not conduct mainstream regulated activities, it
benefits from a specific exemption under FSMA which permits it to carry on regulated activities
which are reasonably regarded as a necessary part of its legal services. The English Firm's role is
to act as the Client's legal advisor in relation to the matters for which it has been engaged and it
is not part of its function to give financial or business advice on the merits of entering into any
particular transaction or to act as a broker or arranger of transactions. In providing its services,
the English Firm will assume that the Client's decision to negotiate and enter into any transaction
has been or will be made solely upon the basis of the Client's own evaluation. It is not part of the
English Finn's role to communicate to the Client or on its behalf invitations or inducements to
engage in investment activities. No communication from the English Firm, whether written or
oral and in whatever form it is received, is intended or should be construed as such an invitation
or inducement.
Under UK anti money laundering legislation, the English Firm, in common with all UK lawyers
and accountants and many financial institutions and other professional firms, is required to put in
place procedures to prevent money laundering and, in certain circumstances, where the English
Firm knows or suspects or has reasonable grounds for suspecting that a matter or transaction
involves money laundering, it is obliged to make a notification of its knowledge or suspicions to
regulatory authorities. The anti money laundering legislation also requires the English Firm to
identify its clients, and in some cases their beneficial owners, to conduct other background
checks and to retain records of the identification obtained. In some circumstances, it also may be
necessary for the English Firm to make inquiries as to the source of funds which are being used
in relation to a matter on which it advises. These requirements are known as "CDD
requirements". The English Firm tries to meet these CDD requirements using information from
public sources. However, it may be necessary to provide (and permit the retention of)
information and documents to the Firm to pass onto the English Firm, including, in the case of
individuals, evidence of identity (such as a passport) and of home address (e.g., a utility bill). In
some cases, even where the Client is a corporation or other legal entity, the English Firm may be
required to obtain evidence of identity of directors or other principals. The English Firm is not
able to commence work and may decline to act if the CDD requirements have not been made to
its satisfaction.
R. 03/12
Exhibit A — Page 8
AMECURRENT 702035028.1063
RECEIVED
MAY 3 1 2012
C11Y CLERK'S OFFICE STAFF REPORT
CITY ADMINISTRATION
DATE: May 31, 2012
TO: Honorable City Council V
FROM: Mark C. Whitworth, City Administrator
RE: Reform Monitor Contract Amendment r
Backeround
On January 3, 2012, via Resolution No. 2012-06, the City Council approved a four-year contract
with John Van de Kamp and Dewey & LeBoeuf LLP for Mr. Van de Kamp to serve as the City's
Independent Reform Monitor beginning February 15, 2012.
Dewey & LeBoeuf has closed its Los Angeles office and Mr., Van de Kamp has relocated to
Mayer Brown's Los Angeles office as of May 14, 2012.
On May 18, 2012, the City received a revised engagement letter from Mr. Van de Kamp
substituting Dewey & LeBoeuf with Mayer Brown. The terms are nearly identical, with the
exception of a minor change permitting Mr. Van de Kamp the use of partners as well as
associates at rates limited to $525 per hour, and a new schedule of other charges and expenses
found in Attachment A.
Legal counsel has reviewed the revised agreement and approved it as to form.
Recommendation
It is recommended that the revised engagement with John Van de Kamp and Mayer Brown for
Mr. Van de Kamp to continue to serve as the City's Reform Monitor during the period of May
14, 2012 through February 15, 2016 be approved and executed.
May 18,2012
Mark Whitworth, City Administrator
City of Vernon
4305 Santa Fe Avenue
Vernon, CA 90058
Re: Representation by Mayer Brown LLP
Dear Mark:
MAYER*BROWN
Mayer Brown LLP
350 South Grand Avenue
25th Floor
Los Angeles, California 90071-1503
Main Tel +1213 229 9500
Main Fax +1213 625 0248
wwwmayerbimm.com
John K. Van de Kamp
Direct Tel +1213 229 9511
Direct Fax 2131576-8116
jvandekamp@mayerbrown.wm
Effective May 14, 2012 1 have become Counsel at Mayer Brown LLP, a law firm whose
Los Angeles Office is at 350 S. Grand Avenue, 25'b Floor, Los Angeles, California.
On May 8, 2012 it became clear that my former law firm, Dewey & LeBoeuf was closing
its Los Angeles office, as termination notices were forwarded to all the secretaries and
associates. In the days preceding this notice firm closed down its copying services for attorneys;
no longer could the firm supply the support services required. I then made the choice to join
Mayer Brown's Los Angeles office. It is a highly regarded international firm with headquarters
in Chicago. My new colleagues at the firm include former California Assembly Speaker Bob
Hertzberg, former Secretary of State Commerce Mickey Kantor and others with substantial
governmental experience.
Given this turn of events, I attach a revised Engagement Letter substituting Mayer Brown
for Dewey & LeBoeuf The terms are nearly identical, except for a minor change on page 8
which permits me to use partners as well as associates limited to $525 per hour, and a new
schedule of other charges and expenses found in Attachment A.
I ask that this new Engagement Letter be approved, to be effective retroactively to May
14, 2012, the date of the changeover. This means that billing could come from Dewey &
LeBoeuf through May 11, 2012 and from Mayer Brown thereafter.
Mayer Brown LLP operates in combination with other Mayer Brown entities with offices in Europe and Asia
and is associated with Taull & Chequer Advogados, a Brazilian law partnership.
AMECURRENT 701805798.1063
Mayer Brown LLP
Mark Whitworth, City Administrator
May 18,2012
Page 2
Thank you for your consideration.
Sincerely,
Enclosure JO r. Van de Kamp
AMECURRENT 701805798.1063