HomeMy WebLinkAbout12 Underwriter and Appraiser Agenda Item # :�...
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Memorandum
To: Board of Directors
From: Stephen Hollabaugh
Date: August 15,
Date of Board Meeting: , August 20, 2003
Subject: Selection of an Underwriter and Appraiser related to the formation of
Community Facilities Districts 03-1 and 03-2
1. WHY THIS MATTER IS BEFORE THE BOARD
To inform the Board of the recommended Underwriter and Appraiser related to
the formation of Community Facilities Districts 03-1 and 03-2.
2. HISTORY
The process of formation of Community Facilities Districts 03-1 and 03-2 includes
selection of an Underwriter and Appraiser. With the help of Larry Rolapp
(District's Financial Advisor)the District and East-West Partners have met with
Underwriter candidates and an RFP for an Appraiser has been sent to
candidates. Each of the candidates has extensive experience with Mello Roos,
Community Facilities Districts and land based financing. The candidates for
Underwriter and Appraiser are as follows:
Underwriter Candidates:
US Bancorp, Piper Jaffray
O'Connor Southwest Securities
Stone & Youngberg LLC
UBS Financial Services
Appraiser Candidates:
Brown Chudleigh Schuler Donaldson &Assoc.
Bender Rosenthal
Seevers Jordan & Ziegenmeyer
Clark Wolcott Co Inc.
Integra Realty Resources
3. NEW INFORMATION
The District and East-West Partners will receive the proposals for services from
the Underwriter candidates and Appraisers on Friday August 15'h. A conference
call has been scheduled between the District, Larry Rolapp, and East West
Partners to discuss the proposals on Tuesday August 1 g`h. I will bring the results
of our analysis of the RFP's to the Board meeting on August 20, 2003.
4. RECOMMENDATION
a. I recommend that the board the that Staff commence discussions with
at such time that we are ready to consider the sale of
bonds, we will present a bond purchase agreement to the Board for its
consideration related the formation of Community Facilities Districts 03-1 and
03-2.
b. I recommend that the board the selection of as the
Appraiser related the formation of Community Facilities Districts 03-1.
BROWN, CHUDLEIGH, SCHULER, DONALDSON AND ASSOCIATES
REAL ESTATE APPRAISALS-MARKET STUDIES
LAWRENCE E.BROWN, MAI,CRE(1942-1990)
WALTER H.CHUDLEIGH,III,MAI
GREGORY S.SCHULER
CHRISTOPHER T.DONALDSON,MAI,CCIM
WILLIAM J. KRANSTOVER
DEAN A.MYERS
D.TYLER DUSTMAN
WAYNETURNER
PETER A.CHUDLEIGH
JESSICA STEVENS
KYLE BAMFORD
August 14, 2003
Mr. Larry Rolapp
Fieldman, Rolapp &Associates
2100 Main Street, Suite 210
Irvine, CA 92614
Reference: Fee Proposal for Proposed Issuance of Special Tax Bonds for the Old
Greenwood—Truckee Donner PUD.
Dear Mr. Rolapp:
We appreciate the opportunity to submit this request for fee proposal related to
the Old Greenwood—Truckee Donner PUD, hereinafter referred to as the Truckee Donner PUD
or the District, located in Truckee, California. It is our understanding that this development is
currently underway, and the residential property within the boundaries of the Community
Facilities District (CFD) will be as follows:
• 99 single family lots plus four existing cabins and one lot for single family
construction
• 74 cabin lots and fractional units
• 100 town homes and fractional units
It is our understanding the CFD plans to issue a special tax bond to fund water,
sewer, electric and possibly Broadband and other public improvements. We are experienced
in the appraisal of developments with special tax bonds to fund infrastructure for development,
We hope you find this fee proposal acceptable.
MOUNTAIN STATES OFFICE.1500 E.KEARNS,SURE E-303 PARK CITY,UTAH 84060.(435)649-0236
NORTHWEST OFFICE 50 SW PINE STREET,SUITE 400 PORTLAND,OREGON 972N (503)274-0211
NORTHEAST OFFICE:24 GLENWOOD AVENUE NO.8 NORWALK,CONNECTICUT 06554 (203)E57-4124
WESTERN REGIONAL OFFICE:7"CARDLEY AVENUE,SUITE 100.MEDFORD,OREGON 975046124.(541)772- 566.FACSIMILE(541)773-6314
BROWN, CHUDLEIGH, SCHULER, DONALDSON AND ASSOCIATES
1. Scope of Services
The scope of services to be provided is a complete appraisal in a self-contained
report of the property within the boundaries of the PUD which provides, but is not limited to,
the following:
• In-depth analysis of the locational characteristics of the local market area.
• In-depth market analysis of the competitive developments in the market area for
each of the property types included within the district.
• Market data showing trends in sales of similar developments and potential
absorption will be evaluated.
• Appropriate pricing will be established for each of the units based on an
extensive analysis of the market area and other resort markets.
• It is our understanding an Absorption Consultant is anticipated to be involved in
this project, providing a detailed estimate of absorption.
• We anticipate utilizing a discounted cash flow approach as part of the appraisal.
We will incorporate appropriate absorption, which we believe will be reasonable
and prudent based on market derived absorption rates where possible,
absorption studies, if provided, and projected absorption based on evaluations
of the product type,the feeder markets, access, amenities and other issues. We
understand the most significant factors affecting value are pricing, absorption
and development cost. Our most diligent efforts will be applied to supporting
these key factors in the valuation.
• The value conclusion will be evaluated by the discounted cash flow
methodology, as well as land sales of other development parcels considered
comparable.
2. We understand that the district is authorized to use the appraisal in the preliminary and
final official statements of the bond offering and that a full appraisal will be publicly
available. We are aware that we will be required to review the narrative appraisal
description and other references to value in the body of the preliminary and final official
statements of the bond offering.
3. We understand we will need to sign a certificate at the transaction's closing asserting
that the appraisal information is properly presented within the disclosure documents
and that the appraisal is complete and accurate. The primary appraisers on this
assignment will be Christopher T. Donaldson, MAI, CCIM, and Walter H. Chudleigh, 111,
MAI. Our credentials are contained at the Addenda to this proposal.
-2-
BROWN, CHUDLEIGH, SCHULER, DONALDSON AND ASSOCIATES
4. We have provided a list of Community Facilities District appraisals prepared by our firm
in the last ten years in the Addenda to this proposal. The following is a list of recent
such projects.
Property Name of Issuer Name and Number Size of Issue Type of Property
South Lake Tahoe El Dorado County Jaye Von Klug $33,000,000 34 acres of commercial
Redevelopment Redevelopment Manager land with 199 timeshare
Assessment District condominiums, retail
South Lake Tahoe, California space, parking and ski lift
improvements
Rio Vista Village CFD Cathedral City Dave Faessel $12,230,000 200 acres of proposed
Cathedral City, California Riverside County City Engineer single family and multi-
family housing with
1,260 units
RogersDale USA City of Murrieta Steve Mandocki N/A Live entertainment
Entertainment CFD City Manager venues
Murrieta, California (909)698-1040
Stevenson Ranch Los Angeles County John Edmisten Issue A: 1,110.82 acres residential
Mello-Roos CFD, No. 3 Los Angeles County $20,020,000
Newhall, California Treasurer Issue B:
(213)974-2310 $6,835,000
Issue C:
Maximum
$20,000,000
As mentioned, in addition to the above more recent completions, a more
thorough list of related appraisals prepared by our firm is contained in the Addenda to this
letter. In addition to the public agency references, following is a brief list of other resort-related
developments similar in scope, which we have appraised within the past several years.
• Teton Springs Golf and Casting Club is an approximate 230-acre development,
including a golf course, various cabin lots, single family lots and town home lots
totaling 560 units. This recreational-oriented development is located in Teton
County, Idaho near Jackson Hole, Wyoming.
• Sapphire Beach Resort and Marina is located in St. Thomas, USVI. This
development was proposed for condominiums and fractional ownership
development on the island of St. Thomas.
• Flagstaff Mountain Resort in Park City, Utah is a 1,700-acre master planned
community proposed for 46 single family lots, 1,410,000 square feet of multi-
family dwellings, and 75,000 square feet of commercial space. This
development has direct ski access to Deer Valley Resort.
• Eagle Springs condominiums located at the base area of Solitude ski resort in
Solitude, Utah consisting of 46 units.
-3-
BROWN, CHUDLEIGH, SCHULER, DONALDSON AND ASSOCIATES
• Sundial Lodge condominiums, including 150 units, in the base area of The
Canyons ski resort in Park City, Utah.
• South Lake Tahoe Redevelopment Area, referred to as the Park Avenue
Project, including commercial land with 199 fractional ownership condominiums,
as well as approximately 250,000 square feet of retail and speciality
improvements, including a ski lift gondola station.
• Eagle Point Golf Course development in Eagle Point, Oregon, is a golf course-
oriented subdivision development with approximately 150 units and a Robert
Trent Jones designed golf course.
Overall, we consider ourselves to have a good base of experience in appraisals
related to large land development with a mix of residential product type. We understand resort
areas and are capable in our research of the local market.
5. All of our appraisals are conducted in conformance with the Uniform Standards of
Professional Appraisal Practice (USPAP). We are familiar with the CDIAC guidelines
as it relates to understanding pricing adjustments for the bond costs for individual unit
pricing, as well as the other requirements of these guidelines.
6. We have provided our proposed fee in a separate envelope as requested. These fees
delineate the cost of the draft appraisal, which is due October 1, 2003, and the final
appraisal, which is due October 17, 2003.
7. We are committed to the timing outlined in the schedule for the Truckee Donner PUD.
We understand timeliness among all parties involved is essential in maintaining a
schedule. We would expect to be able to deliver an initial indication of value the last
week of September 2003 prior to delivery of a draft appraisal on October 1, 2003. The
completed appraisal will be made available on October 17, 2003. Christopher T.
Donaldson and Walter H. Chudleigh have provided timely appraisals in the past, as
required by the assignment. We have adequate staff and resources for completing the
appraisals in a timely manner.
Summary
We feel very qualified to prepare a thorough and well-documented appraisal
required of the bond issues. Mr. Donaldson and Mr. Chudleigh have collective experience of
over 40 years in the appraisal business and have been working together on these types of
projects for over ten years.
We feel we have a thorough understanding of the assignment as it relates to the
data and research required to establish the appropriate pricing and absorption. We also have
the expertise to apply the appropriate techniques, such as the discounted cash flow,within the
context of the CDIAC guidelines.
-4-
BROWN, CHUDLEIGH, SCHULER, DONALDSON AND ASSOCIATES
We are knowledgeable of the geographic location of the subject. I have
personally visited Truckee,California and have participated in the recreational activities offered
in the Truckee and Lake Tahoe area, including camping, hiking and boating. We are very
aware of the constraints on development in the overall Lake Tahoe and Sierra Nevada area
and are sensitive to the resort and recreational nature of the area.
The professional qualifications and Christopher T. Donaldson and Walter H.
Chudleigh are contained in the Addenda to this report.
We hope this proposal adequately explains the anticipated appraisal services.
We are committed to providing a thorough and well-reasoned appraisal based on our own
extensive research and independent judgment.
Respectfully submitted,
BROWN, CHUDLEIGH, SCHULER, DONALDSON
and ASSOCIATES 7
Christopher T. Donaldson, MAI, CCIM
a er H. Chudleigh, III, MAI
CTD/WHC:kf
-5-
BROWN, CHUDLEIC,H, SCHULER, DONALDSON AND ASSOCIATES
ADDENDA
BROWN, CHUDLEIGH, SCHULER, DONALDSON AND ASSOCIATES
QUALIFICATIONS
CHRISTOPHER T. DONALDSON, MAI, CCIM
EMPLOYMENT Brown, Chudleigh, Schuler, Donaldson and Associates
Medford, Oregon and Park City, Utah
Independent real estate appraisers and consultants providing
appraisal, feasibility and consulting services throughout the
country.
First Gibraltar Bank, F.S.B.
Dallas, Texas
1990 - 1991
Senior Appraiser responsible for reviewing appraisals for
regulatory and standard's compliance.Also conducted specialized
in-house appraisal assignments.
John D. Bailey and Company
Dallas, Texas
1986 - 1990
Associate Appraiser
PROFESSIONAL
AFFILIATIONS Member, Appraisal Institute (MAI designation)
Member#9157
Member, Commercial Investment Real Estate Institute, Certified
Commercial Investment Member (CCIM designation) Member
#7625
State Certified Appraiser in the following states:
Arizona License #30707
California License #AGO11161
Colorado License #CG01319868
Oregon License #C000331
Texas License #TX-1322246-G
Utah License #CG00042231
EDUCATION Bachelor of Arts, English
Coe College— 1978
BROWN, CHUDLEIGH, SCHULER, DONALDSON AND ASSOCIATES
QUALIFICATIONS
WALTER H. CHUDLEIGH, MAI
EDUCATION B.A. in Economics, Brigham Young University, 1971
MBA with specialization in Real Estate and Finance, Indiana University, 1973
EMPLOYMENT Principal, Brown, Chudleigh, Schuler, Donaldson and Associates, Park City,
Utah-Independent real estate appraisers and consultants providing appraisal,
feasibility and consulting services throughout the country.
Principal, Chudleigh & Company, New Haven, CT, 1977-84
Principal, Lawrence E. Brown &Associates, Stamford, CT, 1984-87
Associate, Landauer Associates/Shattuck Co., Los Angeles, CA, 1973-1976
COMPUTER APPLICATIONS Designed and implemented discounted cash flow, equity yield, and land
development computer models applicable to real estate investment analysis.
TEACHING AND LECTURING Instructor in Advanced Real Estate Valuation, Finance Department, University
of Southern California, 1974-76
CONTRIBUTING AUTHOR "Real Estate Investment Yield as Correlated to the Rate Shown in Money and
Capital Markets," The Real Estate Appraiser and Analyst.
"The Application of Correlation Matrix Analysis to Real Estate Appraisal,"The
Appraisal Journal.
"Computer Aided Graphics for the Appraiser,"The Appraisal Journal.
"The Impact of the Installation of Public Sewers on Commercial Property
Values," The Appraisal Journal.
PROFESSIONAL
MEMBERSHIPS American Institute of Real Estate Appraisers
(MAI) Designation -Currently Certified
ACADEMIC
AFFILIATIONS Omicron Delta Epsilon, National Economics Honorary Society
Brigham Young University, 1969
Beta Gamma Sigma, National Business Honorary Society
Indiana University, 1973
Qualified as expert witness in various state and federal courts
Utah Certified General Appraisal License#CG00038645
BROWN, CHUDLEIGH, SCHULER, DONALDSON AND ASSOCIATES
Assessment District Appraisal Experience
Property Name of Issuer Name and Number Size of Issue Type of Property
Winchester Properties Riverside County Ivan Tennant $65 million + 5,600 acres of residential,
Assessment District Deputy Road Commissioner commercial and industrial
Rancho California/ County of Riverside
Murrietta California (714)787-6554
Rancho Villages Riverside County Ivan Tennant Issue A: 4,372.3 acres light
Assessment District Deputy Road Commissioner $6,196,153.59 agriculture, residential
Rancho California, California County of Riverside Issue B: agriculture, and
(714) 787-6554 $36,554,302.11 residential
Margarita Villages Area Rancho California Phillip L. Forbes $8.5 million + 128.35 acres residential
Rancho California, California Water District Director of
Financelfreasurer
Rancho California
Water District
(714)676-4101
Stevenson Ranch Los Angeles County John Edmisten Issue A: 1,110.82 acres residential
Mello-Roos CFD, No. 3 Los Angeles County $20,020,000
Newhall, California Treasurer Issue B:
(213)974-2310 $6,835,000
Issue C:
Maximum
$20,000,000
West Covina Fashion Plaza Community Jeremy Wisot $45,000,000 26.61 acres retail mall,
Mello-Roos CFD Facilities District Music, Peeler&Garrett retail strip center and
West Covina, California (213)629-7600 restaurant
City of Davis Community Bob Traverso Phase I: 1,012 acres residential,
Assessment District Facilities City Manager $17,600,000 retail,office and industrial
Davis, California City of Davis Davis,California
(916) 756-3745
Rancon Community Riverside County Ivan Tennant $37,100,000 618 acres of commercial
Facilities District Deputy Road Commissioner
Temecula, California County of Riverside
(714)787-6554
Lake Sherwood Assessment Ventura County Art Goulet $15,000,000- 650 proposed luxury
District Ventura County Public $30,000,000 homesites, 122 existing
Ventura County Works homesites, golf course
(805)654-2402 andlake
Rio Vista Village CFD Cathedral City Dave Faessel $12,230,000 200 acres of proposed
Cathedral City, California Riverside County single family and multi-
family housing
South Lake Tahoe El Dorado County Jaye Von Klug $33,000,000 34 acres of commercial
Redevelopment Redevelopment Manager land with timeshare
Assessment District condominiums, retail
South Lake Tahoe,Califomia space, parking and ski lift
improvements
Chaffey Joint Union Chaffey Joint Union Stephen L. Butters N/A 2,588 acres in 56
High School District High School District Director Business Services ownerships
Rancho Cucamonga, (714)968-8511
California
7/90
BROWN, CHUDLEIGH, SCHULER, DONALDSON AND ASSOCIATES
Property Name of Issuer Name and Number Size of Issue Type of Property
Sonoma County Sonoma County Ken Giovanetti $1,684,357 21 residential and
Larkfield Sewer Sonoma County commercial properties
Assessment District No. 1 (707)527-2231
10/90
Sycamore Canyon Business City of Riverside M.William Holsinger $4,628,565 32.96 net acres of
Park(Pepsi) City of Riverside industrial/business park
Community Facilities District Administrative Services land
7/90 Department
(714) 782-5461
Harbour Pointe Residential City of Oxnard Rudy Muravez N/A 156 single family
Development City of Oxnard residential properties
Oxnard, California Confidential
3/92
Mello-Roos Community Los Angeles County Abel Morales N/A 510 residential units
Facilities District No. 5 Dept. of Public Works
Rowland Heights, California Confidential
3/94
Lower Lagoon Valley City of Vacaville David Van Kirk N/A Highway
Community Facilities District Assistant City Manager retail/commercial,
Vacaville, California City of Vacaville office/business park, and
1/93 (707)449-5100 single family residential
uses
Hanford Mall City of Hanford Tom Dibble $4,990,000 9 retail parcels within
Community Facilities District Finance Director Hanford Mall site. Parcels
Hanford,California City of Hanford total 33.694 net acres.
8/91 &4/92 (209) 585-2500
Old Town Westside City of Temecula Ron Bradley Approximately Live entertainment
Community Facilities District City Manager $30,000,000 venues.
Temecula, California City of Temecula
12/95, 11/96& 11/97 (909)694-6444
Plaza Club Apartments California Statewide Gerald P. Burke $3,070,000 208 apartment units
Community Facilities District Communities California Communities
Salinas, Monterey Development (510)933-9229
3/97 Authority
RogersDale USA City of Murrieta Steve Mandocki N/A Live entertainment
Entertainment CFD City Manager venues
Murrieta,California (909)698-1040
2/98&5/99
....... ......................... . .
BROWN, CHUDLEIGH, SCHULER, DONALDSON AND ASSOCIATES
ATTACHMENT "A"
TRUCKEE DONNER PUD
(Old Greenwood)
This attachment is for the purpose of assisting the District, its employees and consultants in
making a fair and impartial evaluation. All firms submitting proposals will require this
attachment. The selection of the appraiser will not be based solely on this attachment and fees
are subject to further negotiations by the District.
PROPOSED FEES
TRUCKEE DONNER PUD
OLD GREENWOOD
1) Cost & Expenses ("Not-to-Exceed")
Fee for delivery of the draft appraisal report by October 1, 2003 $14,500
Fee for delivery of the final report by October 17, 2003 4,500
Total fee inclusive of all expenses $19,000
2) Other
0'
We do not expect to incur the cost of any absorption studies.
2 I,Soo
We would like to receive a$5,000 retainer check prior to commencing the assignment.
ATTACHMENT "A"
TRUCKEE DONNER PUD
(Old Greenwood)
This attachment is for the purpose of assisting the District, its employees and consultants
in making a fair and impartial evaluation. All firms submitting proposals will require this
attachment. The selection of the appraiser will not be based solely on this attachment and
fees are subject to further negotiations by the District.
PROPOSED FEES
TRUCKEE DONNER PUD
OLD GREENWOOD
1) Cost & Expenses ("Not-to-Exceed")
Fee for delivery of the draft appraisal report by October 1, 2003 $17,000
Fee for delivery of the final report by October 17, 2003 4,500
Total fee inclusive of all expenses $21,500
2) Other
We understand that no third party absorption studies will be provided.
We would like to receiv a $5,000 retainer eck prior to commencing the
assignment.
Ole
°?la7ao
0 3 — Z yyBD
' Municipal Securities Group
Response to Request for Qualifications for Bond Underwriter Services
Community Facilities District No. 03-01
(Old Greenwood)
Community Facilities District No. 03-02
(Gray's Crossing)
August 15, 2003
OP
UBS
UBS Financial Services Inc.is a subsidiary of UBS AG
..................................... ..........
�� 777 ouch Fig Services Inc.
777 South Figueroa Street.50`^Floor
Los Angeles,CA 90017
Municipal Securities Group
Daniel Gangwish
Tel. +213-253-5409
Fax +213-253-5401
Daniel.gangwish(Pubs,corn
www.ubs.com
August 15,2003
Mr. Stephan Hollabaugh
Assistant General Manager
Truckee Donner Public Utility District
P.O. Box 309
Truckee,CA 96160
Re: Truckee Donner PUD
CFD No.03-01 (Old Greenwood)and 03-02(Gray's Crossing)
Underwriting Qualifications
Dear Mr. Hollabaugh:
First and foremost, it was a pleasure to meet with you,Mary, Larry,Mark, Rick and Bill last Wednesday. Besides
being a beautiful day, I enjoyed the presentation and driving tour and am very excited about the various East West
projects. I sincerely believe that they are the type of quality land secured projects on which UBS easily surpasses
our competitors on particularly when we plan on retail distribution of the bonds. On behalf of UBS Financial
Services Inc., 1 am pleased to have the opportunity to present our credentials and compete for Truckee Donner's
underwriting business. Besides responding to the questions presented, I would like to use this cover letter to
summarize our qualifications for this assignment in the two main areas—investment banking and bond distribution.
Banking Experience
UBS is the Number One rated municipal bond underwriter in California and the Number Two ranked firm
nationally. More specifically,the vast majority of land secured underwriting experience in California lies with just
two firms, and you are reviewing the qualifications of both. While market share bounces around from year to year,
UBS and Stone & Youngberg have underwritten more than 67% of the land secured volume in California since
1997. As we will outline later, we have significant experience with a variety of high end residential projects that
include private or resort golf courses. As well, we have reviewed a number of situations regarding timeshare or
fractional units.
There are three reasons that banking/underwriting experience matters. First, bankers are responsible for
conservatively underwriting transactions and ensuring proper and complete disclosure. While certainly in our self
interest, it also protects TDPUD and East West Partners should there be any unforeseen changes in the future.
Second, a wide variety of experience (and please note that the District has significant land secured experience in
your bond counsel and financial advisor) allows an underwriter to structure a financing program that optimizes the
results for the participants of the financing team. Lastly, an active underwriter can respond to changes in the
market place to ensure that the financing receives the best acceptance and provides the lowest rates to the property
owners.
Marketing and Distribution
Once again, UBS is Number One or Number Two in senior managed negotiated underwriting of all municipal
bonds in California,nationally,and with land secured bonds in California. Those rankings demonstrate our activity
in the market and come as a result of being rewarded with underwriting business from issuers who we have
consistently proven our ability to obtain the lowest rates possible for. Why do incrementally lower rates matter?
Sometimes it can be significantly lower rates, which, in turn, translates into lower tax payments for TDPUD's
future customers. Second, it improves the credit of the bond issue by reducing the annual carry cost of the bonds.
Most importantly in this situation, is that East West expects fractional unit sales over a ten years period. Lower
August 15,2003
Page 2
rates mean a lower carry cost for East West on those fractional units before they are sold as well as a lower
disclosure amount when offering them to the public.
Once the structure and disclosure are set,the next step for the underwriter is to underwrite your bonds at the lowest
rates possible. Low rates come from four different factors that we briefly point out below.
■ Retail Distribution— while most firms will say they have retail distribution, it usually doesn't compare to UBS'
44 offices and 1,321 financial advisors in California as well as 2 offices and 15 financial advisors in the Tahoe
area of Nevada. The majority of our nonrated issues are sold on a retail basis, at rates lower than are available
institutionally. We have fairly exacting underwriting standards but our municipal clients are repaid with lower
rates due to the trust and reputation we have built in the marketplace. As a testament to this, will provide a
compelling interest rate comparison in our attached response.
■ Institutional Distribution — is a key factor and since UBS has underwritten $29.3 billion in municipal bonds
nationally already this year, we have the institutional access (even though we will expect an entirely retail
distribution,which we discuss further in our response herein)to distribute your proposed offerings.
■ Capital—since we underwrite many of our nonrated land secured issues on a retail basis, we often have unsold
balances and regularly commit the firm's capital to purchasing unsold bonds on the day of pricing and sell them
off over time. That directly translates into lower rates.
■ Aggressive Fees—we have proposed what we believe to be a very aggressive range of fees for this assignment.
And we have repeatedly demonstrated our ability to access the retail market with our proposed takedowns which
Mr. Rolapp and Mr. Murphy have repeatedly witnessed.
How to Differentiate UBS
As I briefly outlined last week,there are a few points that distinguish UBS from our competition. As you can see
from the rankings contained within, there are a number of firms with some limited experience but only two firms
that stand out that are more than capable of this assignment. The better selection criteria at that point is which firm
can provide the lowest overall cost of capital. Following are three points of note. As we talked briefly about,the
average land secured deal size industry-wide (excluding UBS) is $10.9 million while UBS' average land secured
deal size is $29.4 million. Second, please note the high-end communities we have underwritten land secured
financings for. And lastly, our retail distribution as highlighted by the rate comparison contained herein has
secured and will continue to secure lower rates for our clients.
If you have any questions,or desire any additional information please contact me at(213)253-5409.
Sincerely,
Daniel Gangwisk
Daniel Gangwish
Managing Director
CC: Larry Rolapp
Mark Wasley
rammCommunity Facilities District No. 03-01/03-02
TABLE OF CONTENTS
Pages
Overview of Firm...... ................... ....... I
Team.........---.......--.... .................. 4
Distribution Capability and Marketing Plan................ 7
Proposed Fee Schedule—.........---...... ... 12
Appendix
Senior Managed California Negotiated CFD/Assessment District
Experience Since 1997.....----...... .......... .... .... A
UBS
VIN
'iM-Community Facilities District No. 0 3-0110 3-02
1. Briefly describe yourfirm.
OVERVIEW OF UBS FINANCIAL SERVICES INC.
UBS Financial Services Inc. ("UBS")(Formerly UBS PaineWebber Inc.) is a wholly-owned subsidiary of UBS AG
—one of the largest and most highly rated securities firms in the world. UBS AG currently maintains over 69,552
employees in more than 50 countries, manages more than $1.4 trillion in client assets, and carries credit ratings of
Aa2/AA+/AAA from Moody's, S&P, and Fitch, respectively. Within the United States,the Firm currently employs
approximately 19,262 employees, and has offices located in all 50 states and Puerto Rico. UBS has a strong capital
base and a sizable excess net capital position of$14.5 billion.
MUNICIPAL SECURITIES GROUP
UBS' Municipal Securities Group ("MSG"), assists municipalities, government agencies and other entities in
structuring, underwriting, trading and distributing tax-exempt and taxable bonds and notes. Unique in its
framework, MSG has a fully integrated structure that combines the banking, sales, trading, derivative and
underwriting functions into a single entity which reports to one manager. Importantly, UBS brokers sell more
municipal bonds per account than any other U.S. brokerage firm. MSG provides the primary and secondary
offerings to"Peed"this vast retail appetite.
The MSG employs approximately 336 professionals throughout New York and its 23 regional offices nationwide.
COMMITMENT TO MUNICIPAL FINANCE
UBS is fully committed to its Municipal Securities Group and intends to remain a leader in
public finance. On a broader level, the Firm also recognizes the importance of our
municipal securities operations as an integral component of our fixed income business
domestically. In fact, UBS' published first quarter 2003 results included a specific focus
on the outstanding performance of the Municipal Securities Group, which further
underscores our overall commitment to the municipal industry. This commitment also has
been evidenced by our continued growth as a department. Since 1997, the MSG has - _- -
increased its staff level by 37%nationwide,and by approximately 55%in California. UBS -- ---has assigned more local bankers to California, which leads to more focused attention on
our issuer clients, offering the most tangible evidence and meaningful application of our
commitment as it relates to the State.
HISTORY AND COMMITMENT TO PUBLIC FINANCE IN CALIFORNIA
Our public finance practice in the State includes 4 public finance offices, 33 dedicated municipal bankers, I
municipal bond underwriter, and 2 institutional salespeople located within the State. As indicated to the right, our
Firm's investment banking professionals constitutes the largest commitment of public finance investment banking
personnel by any Wall Street firm in California. UBS' level of staffing, especially at the junior levels, ensures
quality service and the timely completion of assignments. Moreover,unlike many of our under-staffed competitors,
our team approach to senior banking coverage ensures that we can achieve the most expeditious financing schedules,
while still delivering experienced,senior level attention at all times.
Banking Professionals Underwriling Desks I rading Desks
UBS Financial Services Inc. 33(L.AJS.FJM.VJSac.) I (L.A.) 1(L.A.)
Citigroup; f9(L,A./STJ ac.) 1(L.A.) I (L.A..)
7.1?;:Morgan ld;-(S:F.) lYone None':.
MorganSgnIey'� None None:
Br ,Securitres; -: S:{15.A.1fi.)".) I (S,F.) I
Lehman Brehm S,(L.A,S,F.) None None:
Merrill Lynch ':7, .;41S.F.) None I(L Ar )
Goldman,Sachs-I (.( .).' None Now .
Bear,Stearns .5{L:A.) None 1
• UBS 1
VMS=
Community Facilities District No. 03-01/03-02
Our strength and presence in the State is evidenced by our ranking as the Number One underwriter of all senior
managed negotiated California issues since 1998,as shown below.
Top 5 California Senior Managed Negotiated Municipal Bond Rankings—O1/01/98 to 07/31/03
(S Millions)
UBS Financial Services I
$17,411.2
Cingroup . $16,854.0
I P Morgan $14,679.6
Morgan Stanley $12,737,6
Merrill Lynch $12,720.7
0 5,000 10,000 15,000 20,000
Source; Securities Data Company.
Our commitment to municipals is also evidenced in the number of salespersons, traders and underwriters involved
with California issues. Specifically,we have 17 retail bond salespersons and 17 municipal institutional salespersons
in California. Furthermore, UBS has one of the largest retail and institutional distribution networks,with 44 offices
in the State. These 44 offices employ 1,321 investment executives managing $74.6 billion of assets for 684,371
California residents.
EXCESS NET CAPITAL
In addition to our experience in senior managing transactions, UBS' strong capital base and sizable excess net
capital position enable us to underwrite any transaction currently contemplated by the District. UBS aggressively
commits capital on behalf of its clients, and will do so, as needed, for any transaction in which we are involved as
underwriter for the District.
Total Firm Capital S 60.187 Billion
Net Capital $ 28.733 Billion
Net Excess Capital $ 14.497 Billion
Includes UBS Financial Services Ine.'s access to capital through its parent company UBS AG_
As a matter of policy, UBS' uncommitted excess net capital is not allocated to individual departments.
Underwriting capability is directly related to an underwriter's excess net capital. According to the SEC's uniform
net capital rule on long-term tax-exempt issues,for every security that a firm puts into inventory,7%of the value of
that security must be backed by available capital. This currently allows UBS to legally underwrite, as sole book-
running senior manager, a long-term issue of approximately $16.7 billion as of June 2003. In the recent weeks
where there has been significant volatility in rates, we have used our capital by underwriting 77%and 47%of the
last two issues that we senior managed in California in order to lock-in the lowest possible rates for our clients.
LAND SECURED EXPERIENCE
The primary determinant of ability with CFD special tax bonds is prior experience. Not only is experience with
special tax bonds important but experience with a wide range of project types including those utilizing the 1915 Act
assessment law is just as critical. Since January 1, 1997, we have served as senior manager on 46 separate
Assessment District issues totalling S I A billion in the State,ranking us as the Number One underwriter in this area.
During the same time frame, we served as senior manager on 50 CFD issues totalling$1.2 billion which also ranked
us as a leading underwriter in this area. Our experience ranges from deals as large as$510 million to issues as small
as 50.89 million. However,an important point is that our average senior managed deal size has been larger,at$27.4
million for land secured issues(ADs/CFDs)vs. an industry average ofjust$10.9 million.
. UBS 2
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'Community Facilities District No. 03-01/03-02
Assessment District Rankings Mello-Roos Rankings
Senior Managed California Transactions(Negotiated) Senior Managed California Transactions(Negotiated)
01/01/97 to 07/31/03 01/01/97 to 07/31/03
!3 MilDnm) 15 Mtllio
IInC riaanaal 52n5 SlplJ6. Store&1'oungMg 524464
S�OMdYwngMy $7454 Uss neaaaial5mdttm Y131>.1 :):•,.
Ciligrmp 3146.5 WmIwH,Core&H.J.a SIIIA n. ^..
Prage[SeaN&Co.LLC SIAS 5 - S sh.rn Sewmles $2.9<Se.
AImn.Ne1..&Co. 5137.9 US8an N"uff., $2246
US.ammry 51323 '., RIC Dain RauuMr SIW.3
Swlhx2zt RnvlYx SI297 - Ci,µro�p S10d6 ai .,
aaC alln lo.,r S1212 M,p 5m 1, S99.7 �..
RedxwE Se'urrcks 349-0 � VeSAwage MW Sw ra6 pqm„ '. EL 4La Row 590I -. U9sm'w (wl R+FS]aum
nw�„r,n�aa=nz
Wa�hofi,Core&Holrmte�h D69 Marshall,Miller&SCMaMer S377
0 SW LOW 00 2.os 0 7W LiOC 21W Z&V 3FW
Source: Securities Data Corporation. Source: Securities Data Corporation.
Numbers within bars represent number ofdeals. Numbers within bars represent number of deals.
Market share highlighted in gr een. Market share highlighted in green.
In addition to our ranking as a leading underwriter in this area, the land-secured team at UBS is one of the most
creative in California. We have been at the forefront of many of the techniques and structures utilized with land-
secured issues today. Our track record of creativity with respect to Community Facilities District (and other land-
secured)financings is essential in an underwriting firm because of the unpredictability of the process of structuring
and implementing non-rated land secured transactions. UBS is regarded as the pioneer in developing a host of new
innovations in the land-secured financing market. Among the"Firsts"for which UBS is credited are the following:
✓ Successfully structuring and bringing to market the first ever Community Facilities District bond issue;
✓ Successfully structuring and bringing to market the largest residential property land-secured bond issue;
✓ Successfully structuring and bringing to market the first ever variable interest rate Community Facilities District
bond issue;
✓ Successfully structuring and bringing to market the first ever insured Community Facilities District bond issue;
✓ Developing and implementing the first use of a senior/subordinated bond structure for a land-secured financing
to secure investment grade ratings on senior lien bonds;
✓ Successfully structuring and bringing to market the first Community Facilities District bond pool that obtained
bond insurance on the entire pool;
✓ Successfully structuring and bringing to market the largest industrial/commercial property land-secured bond
issue;and
✓ Successfully securing bond insurance on a reassessment district without debt service coverage and with less
than 70%of the property developed.
A listing of our senior managed California negotiated CFD/Assessment District experience since January 1, 1997 is
included as Appendix A.
SPECIFIC PROJECT EXPERIENCE
A specific component of Old Greenwood and Gray's Crossing is the fact that they are resort properties, have high-
end (Nicklaus and Jacobson) golf courses, as well as fractional ownership interests. We will discuss specific
underwriting criteria later for Old Greenwood and Gray's Crossing. However, in terms of relevant experience on
fractional ownership, Daniel Gangwish, John Gibson and Frank Lauterbur have all worked with The Irvine
Company at different times on the Newport Coast project. That project included a site planned for a Hyatt
timeshare,which was ultimately sold to The Walt Disney Company,who,after contemplating a conversion issue for
their planned timeshare resort,paid off the assessment lien, Subsequently,The Irvine Company repurchased the site
which was resold to The Marriott for the timeshare program. Throughout this process, a number of points were
confirmed. The ultimate credit issue for land secured issues is whether the property is developed or not. Once a
land secured project is developed, it is fairly unlikely to have any credit issues. Please note that, obviously,
developed issues with thousands of single family homes with a 30:1 value-to-lien are a better credit than a
developed issue with one apartment building with a 9:1 VTL. But that credit issue goes to interest rate differentials
(particularly in a refunding situation). The real issues beyond the basic value-to-lien analysis are: (1)whether the
UBS 3
ifillYi'Community Facilities District No. 03-01/03-02
timeshare/fractional unit operator has the experience and a compelling reason to be in this project at this time and
(2)whether they have the financial resources to carry the unsold/undeveloped component through completion.
When marketing nonrated bonds on a retail basis to(primarily)high-net worth individuals,the story that the finance
team puts forth in the preliminary official statement can influence rates to an unbelievable extent. Institutional
buyers care only about getting a good deal and whether they can outperform the competitors in their industry(which
means buying bonds at higher interest rates). In contrast, our high net worth clients own second homes, they
regularly travel to resort destinations and they have private golf club memberships. These people typically hold
their bonds to maturity and are not as sensitive to locking in yields that may be a few basis points lower. We very
much market high-end land secured projects to the same people that are looking at East West's custom lots and
fractional unit programs, which greatly benefits the pricing of our bonds for our issuers. Below is a brief list of
resort and private golf course projects that UBS has underwritten bond issues on. The majority of the residential
components are custom or semi-custom homes.
UBS Ex erience with Limited Tax Financin s for Hi h-EndGolf Course or Resort Develot2ments
Golf"urse/Resort
Issuer Developer
City of Irvine The Irvine Company Shady Canyon
Orange County Pelican Hill(Ocean&Links)
Irvine&Tustin USD's Oak Creek
Tustin Ranch
El Dorado County Serrano Associates LLC Serrano
City of San Jose Shea Homes Silver Creek
City of San Diego Santaluz Santaluz
City of Anaheim Walt Disney Company Disney's California Adventure
Orange County Various Talega
Santa Margarita Water District Coto de Caza(N&S)
Capistrano USD Tijems Creek
2. Identify individualsfrom yourferm that will be directly working on the projects. Provide their recent
experience of working on similar projects.
Our finance team for the District's proposed transactions will be led by Mr. Daniel Gangwish,a Managing Director
with 16 years of experience in the California municipal finance industry and an expert in CFD/AD financings. He
will serve as the day-to-day banker and primary contact for this financing. Mr.John Gibson,a Managing Director
with over 20 years of experience in the land secured industry will act as the limited tax specialist, advising on
specific CFD credit issues. Mr. Mark Adler, a Managing Director and one of the industry's foremost experts in
Mello-Roos financings in the state, will serve as the resource manager to ensure overall commitment of resources.
Ms. Rose Wang,a Vice President, will serve as execution banker and manage all technical and execution support.
Providing all technical analysis and execution support, will be Ms. Rosalyn Chen, an Associate, and Ms. Yoko
Tamura,a Senior Analyst. Each individual on the team is committed fully to providing the highest level of service
and would be available to commit up to 100%of their time as required to complete the proposed financing.
As in all land secured projects led by Daniel Gangwish, the financing team for Truckee Donner PUD will see Mr.
Gangwish and Ms. Wang at all meetings. The remainder of the team is outlined here to show the breadth and depth
of experience that CBS possesses and will commit to this financing to ensure success in meeting any given
financing schedule.
DANIEL GANGWISH Los Angeles
Managing Director,Investment Banking (213)253-5409
Mr.Gangwish joined UBS in early 1990 after completing three years in the municipal finance department of a major
investment banking firm. Mr.Gangwish has been UBS' primary banker for Mello-Roos Community Facilities
District, and assessment district financings. He has been responsible for all City of Irvine assessment district
financings as well as other innovative issues, such the City of Irvine and Tustin pooled assessment district
financings. Another innovative issue involved the limited tax financing for the City of Anaheim which is supported
UBS 4
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Community Facilities District No. 03-01/03-02
by incremental hotel,sales and property taxes from a new theme park to be built by the Walt Disney Company. The
$510 million financing received national attention as an Institutional Investor "Deal of the Year". Additionally,
Mr.Gangwish pioneered the innovative senior lien/junior lien financing structure for $246.9 million City of
Pleasanton and Prudential Real Estate assessment district bond issue and has implemented similar pooled structures
for numerous issuers in California.
As it pertains to projects similar to the District's, Mr.Gangwish has worked on a number of land secured financings
for high quality golf course or resort developments. Specifically,he has senior managed deals for: The Walt Disney
Company's California Adventure Theme Park expansion and The Irvine Company's Shady Canyon, Oak Creek,
Tustin Ranch and Pelican Hill assessment district issues, all of which involved golf courses. He has also senior
managed issues for communities with golf courses including El Dorado Hills (Serrano), Samaluz and Silver Creek
(Shea Homes).
Mr.Gangwish has been a speaker about assessment district and Mello-Roos financing alternatives at conferences
sponsored by CDIAC, UCLA and UC Davis. Mr. Gangwish is a graduate of the Columbia University Graduate
School of Business (M.B.A. - finance). He also received his J.D. from McGeorge School of Law in Sacramento,
CA and a B.A. in Political Economic Theory from Ottawa University.
JOHNGIBSON Mission Viejo
Managing Director,Investment Banking (949)467-6089
Mr. Gibson, who will serve as limited tax specialist,joined UBS as a Managing Director in January 2001 following
a total of sixteen years as a Managing Director with two previous investment banking firms and twenty years in a
local government senior financial management and administration.
Mr.Gibson has lead managed a variety of public financings,but has developed extensive expertise in assisting local
governments with complex Mello-Roos and Assessment District new money and refunding financings including a
variety of Marks Roos financings for Cities,Counties,and school districts. He has extensive experience with phased
or escrowed as well as overlapping land secured financings. As a leading expert, he has participated in a number of
speech and panel discussions throughout the State on almost every aspect of land secured financing. John has been
active in drafting and amending Community Facilities and Assessment District legislation, including testifying
before the State Treasurer and legislative committees. In his career, Mr. Gibson has managed nearly 200 land
secured financings totaling over $2 billion. His specific experience with golf course community development
projects includes three issues for Santa Margarita Water District: Talega,Coto de Caza and Tijeras Creek.
Mr.Gibson is a graduate of San Diego State University (BS in Accounting). He also received an MPA from
University of Southern California,and an MBA from Pepperdine University.
MARK ADLER Los Angeles
Managing Director,Investment Banking (213)253-5403
Mr.Adler joined UBS in early 1990 after completing eight years with the Municipal Finance Department of another
major investment banking firm where he was Manager of that firm's Western Region. He has been involved with
hundreds of senior-managed tax-exempt bond issues in California over the course of his 20+years in public finance.
In addition, Mr. Adler has been involved in a significant amount of land secured financing. Mr. Adler recently
masterminded the first pooled Mello-Roos district financing able to forego the senior/junior lien structure and
receive a rating on the entire district. Mr. Adler is recognized in the industry as one of the foremost experts in
assessment district and Mello-Roos finance. He also worked on the City of Anaheim's $510mm issue which
involved the expansion of the California Adventure Theme Park.
Mr.Adler regularly has been featured at public finance conferences sponsored by UCLA and U.C. Davis and
recently served as co-moderator. Mr. Adler is a graduate of the Wharton School Graduate Division (M.B.A.-
Finance and Public Management)and the Wharton School Undergraduate Division where he graduated summa cum
laude. He also attended the London School of Economics.
ROSE WANG Los Angeles
Vice President,Investment Banking (213)253-5414
Ms. Wang joined UBS' Los Angeles Public Finance office in 1998, after having worked 3 years at NatWest
Markets' West Coast Public Finance Office. Since joining the firm,she has been involved with a number of Mello-
Roos/assessment district transactions in California. She has been the primary execution and transaction support
banker for all senior managed assessment district issues for the Cities of Irvine and Tustin. She has also worked on
jBs 5
" � -Community Facilities District No. 03-01/03-02
Community Facilities District financings for Orange County, Irvine Unified School District, Los Angeles County
Community Facilities District and Tustin Unified School District.
Ms.Wang graduated with a Bachelors of Arts degree in Business-Economics from the University of California,Los
Angeles and holds a MBA from USC. She is a registered representative with the NASD(Series 7 and 63).
ROSALYN CHEN Los Angeles
Associate,Investment Banking (213)972-5400
Ms. Chen recently joined UBS' Los Angeles Public Finance office in 2003. Her background in the public finance
includes financial advisory, financial structuring, and analytical support for municipal infrastructure, land-secured,
and not-for-profit transactions. Prior to joining UBS in 2003, she worked for 5 years at Fieldman, Rolapp &
Associates and David Taussig&Associates in Orange County and Sacramento. As an Associate at UBS, Ms. Chen
provides transactional,technical and structuring support for land-secured and municipal infrastructure financings.
Ms. Chen graduated with a B.A. degree in Economics and Political Science from the University of California, San
Diego and holds a MBA from USC.
YUKA TAMURA Los Angeles
Senior Analyst,Investment Banking (213)972-2055
Ms. Tamura recently joined UBS' Los Angeles Public Finance office in 2003. Ms. Tamura's background in the
municipal market includes transactional,analytical and structuring support and financial modeling for land-secured,
education, and municipal infrastructure financings. Prior to joining UBS, she worked for two years at a bulge
bracket corporate investment banking firm and for one year in public finance at another firm. As a Senior Analyst,
Ms. Tamura has provided execution support for a number of land-secured/tax allocation transactions for Santa
Margarita Water District, the, South Orange County Public Financing Authority, Irvine Public Facilities and
Infrastructure Authority, Riverside Redevelopment Agency, Irvine USD and City of Corona. She is currently
involved with pending transactions for Eastern Municipal Water District and Poway Redevelopment Agency.
Ms. Tamura graduated cum laude with a B.A. in Mathematics and Economics from Bryn Mawr College and is a
Registered Representative with the NASD(Series 7).
UNDERWRITING,MARKETING&RESEARCH TEAM
We have assembled a team of underwriting, marketing and research professionals with substantial experience in
Special Tax bond issues. These team members are responsible for the marketing and research of all of UBS' land
secured financings.
JOHN P. FEERY New York
Managing Director,Syndicate Desk (212)713-2880
Mr. Feery has over 20 years of experience in the Municipal Securities industry. Mr. Feery is the lead underwriter
for complex municipal transactions both taxable and tax-exempt, and for all of the firm's significant land-backed
financings in California. As Managing Director in our Syndicate Department,his major area of responsibility is the
development of a marketing program for our clients' financing which includes coordinating with the issuer and
borrower, identifying probable buyers, and setting pricing levels, while working closely with the retail division,
derivative area, reinvest desk and Taxable Fixed Income Group. Mr. Feery advises our clients regarding market
conditions and economic developments which could effect pricing levels. He is instrumental in explaining salient
features of an issue to investors.
Mr. Feery has been involved in over 160 Mello-Roos/Assessment District financings totaling over$4.2 billion. He
is also credited with structuring the first taxable convertible zero coupon municipal issue and the first dual super-
sinker. He is Vice Chairman of UBS' Municipal Credit Committee. Mr. Feery joined UBS in 1984 after three years
of financial analysis and municipal bond experience with two New York money center banks. Mr. Feery holds a
B.S.in Accounting from Providence College.
BRAD GEWEHR New York
Managing Director&Director of Municipal Research,Municipal Research Manager (212)713-3267
Mr. Gewehr joined UBS in 1998 as Director of Municipal Research. Immediately prior to joining UBS, Mr.
Gewehr was a Managing Director in the Public Finance Group of Moody's Investors Service. He supervised a staff
UBS 6
rS Community Facilities District No. 03-01/03-02
of analysts responsible for assigning and maintaining ratings on municipal tax-backed, utility revenue, and lease
credits in 26 states, including Califomia, New York, Florida, and Illinois. As a senior member of the Rating
Committee,he participated in rating decisions for major credits throughout the United States.
Prior to joining Moody's in 1991, Mr. Gewehr was a Project Manager and Transportation Analyst with the Port
Authority of NY&NJ. He holds an MBA in Finance from New York University and a BA from Amherst College.
JOHN OWENS Los Angeles
Managing Director,West Coast Municipal Bond Department (213)972-2001
Mr. Owens manages local underwriting, sales and trading effort for all negotiated and competitive West Coast
financings priced by UBS. Mr. Owens holds a B.S. from St. Johns University and has fourteen years of municipal
trading experience.
3. Provide a bond marketing program which identifies bond marketing and sales issues that are directly related
to these projects and that would directly affect pricing(value to debt ratios,primarily undeveloped/developer
.deal,fractional interests, high end product types, second homes, etc.)and distribution (institutional, retail,
combination-ifso how weighted, serials, terms, combination-ifso how weighted, large denominations, "big boy
letters,"etc). Based on your conclusions, what type ofpremium (not "bond premium')or penalty will these
transactions be faced with in the sale and distribution of these bonds.
INTRODUCTION
This section outlines UBS'marketing and distribution capabilities. We have left in all the pertinent facts and figures
in at the end of the section that demonstrate why UBS is the Number One Underwriter of municipal bonds in
California and Number Two nationally. But before that section,we will provide,our analysis of the specific credit
here,our expected distribution plan and a pricing comparable from Wednesday of this week.
CREDIT EVALUATION
Since Old Greenwood is the initial focus point, we will outline our thoughts on that specific credit. When
underwriting a nonrated land secured issue,the credit factors layout in the following order. The first credit factor is
the value-to-lien. With only 99 custom home sites(available...ever),at an average of$300,000 each plus$4mm for
the four existing houses,the total comes to$34 million dollars,or basically a 3.5:1 VTL without assuming any value
for the fractional unit's land. Moreover,the appraiser will be able to use actual sales prices in their appraisal. With
a simple absorption and discounting of the land for the fractional units,the value can easily exceed$50 million. At
this value and a VTL of 5:1 or 6:1, this is an extremely strong VTL and very appropriate for retail. The second
factor is the developer story. This will be one of the most important items to stress. First, East West Partners'
experience in Colorado with resort development and fractional ownership management will be a key component in
providing credibility to the story. Second, the buildout or development of the fractional units will take some time.
However,if the majority of the developer's costs are recovered through custom lot sales,and the development of the
golf course,then there is significantly less pressure on East West to rush sales or development of the fractional units.
As long as the construction of the units is paced with the sales,then this becomes a very saleable story. But lastly,
and perhaps most importantly, is the financial resources and commitment of Crescent (CEI) to East West and these
projects. While clearly nonrecourse debt, ownership by a strong publicly traded REIT is a fact a bondholder will
rely upon. The third factor is the commitment,to the project and area. We talked about synergy among the various
East West projects. But from a creditor's perspective,it is less about synergy(although that is a great fact here),and
more about an overall financial commitment to the Truckee/Northstar area (including 3 major residential projects,
the Tahoe Mountain Club, the Wild Goose restaurant and the Coyote Moon Golf Course) which provides a lot of
comfort that the developers won't walk away before completion. The last credit factor is really everything else.
Here, that primarily means we are discussing a resort location, with second homes and fractional ownership
interests. Given the discussion throughout this submission, that is not a primary consideration. It is an important
item of how it relates to the credit factors above. For example, the custom lots will carry an allocated lien in the
$30-$35,000 range. So the POS will likely describe diversified ownership but an undeveloped status. But if they
average over$300,000(and I believe Bill said they started at around$225,000)then they will carry a 10:1 value-to-
lien if they remain undeveloped forever. The fractional units will obviously carry an initially lower value to lien,
but,it should still exceed 3:1. The disclosure about fractional units will be important to articulate clearly. From a
credit perspective,they are somewhere between single and multi-family ownership. The key point is that there is
one tax bill for the unit which is allocated by the management company to the owners. But once built,there is little
ate UBS 7
is 'Community Facilities District No. 03-01l03-02
risk. The real credit discussion at bond sale is the build-out period and the developers financial strength during that
period. It is important to disclose a compelling downside case utilizing the credit factors above while at the same
time telling the positive, upside story. Once again, as a resort project, time to build-out and volatility of resort
property valuations will be an issue. What are the competing projects, if any? As Bill mentioned, Lahontan is not
that directly comparable. These components of the basic credit story matter but they are a minor component of the
overall credit evaluation.
EXPECTED DISTRIBUTION
We would plan on an exclusively retail sale. Despite this, we would insure that every institutional buyer of these
type bonds would receive the POS and an order solicitation. But everything in our experience tells us that retail will
accept lower interest rates. Our comparables in the past and the one shown below proves just that fact. We would
structure the issue with serials out through 15-20 years along with (most likely) two term bonds through the final
maturity. Because of the VTL and retail sales,there would be no"big boy"letters,large denominations or any other
constraints on marketing the bonds. If, for some reason the PLO was concerned about retail distribution of the
bonds, we would like to have an opportunity to discuss that point at length because we do not believe it to be
warranted here. First,UBS is very careful and selective about how we sell and to whom we sell nonrated securities.
Second, we have worked with a variety of issuers on a number of transactions who were concerned about
distribution and have created internal requirements that limited access to retail (such as branch manager approval of
each retail order)that didn't impact pricing the way other constraints would. As a side note and lead-in to the later
fee section, we generally work for a $10.00 takedown for nonrated retail sales and have proven successful
distribution consistently. On any issue up to $15 million we would expect a primarily or exclusively retail sale.
Once the par crosses $20 million, some institutional participation may be required depending upon market
conditions,the issue being offered, etc. We generally believe site visits to be of great value on nonrated issues for
institutional analysts (and this property shows beautifully). However, we generally don't like to schedule tours for
retail brokers. The problem is with a thousand brokers,you can't be completely sure who has clients that will put in
orders on a given transaction. Here we would propose the use of color photographs, maps and renderings either in
the POS or separately contained in our internal research reports to convey that message. Materials such as the
handout I received from Mark which included maps and other materials along with the DVD is very compelling
marketing material for salespeople and credit/rating analysts. Additionally, site visits by our underwriters or
research analysts would also be helpful if they can be arranged to accommodate various schedules.
RECENT COMPARABLE SALE ON AUGUST 13TH
Participants in the industry have always had running discussions about the relative ability of various firms to price
nonrated bonds better or worse on any given day. The fundamental problem is that comparisons are made on
fundamentally different pieces of property that may have different VTL's and may price on different days. In my
time in the business, I have not seen two issues secured by the same property price the same day until this week. On
Wednesday the 13", UBS priced an Eastern Municipal Water District financing secured by the same overlapping
property (Temecula's issue actually had an additional 130 units security on top of the overlapping 451 units) as a
Temecula Valley LSD issue, priced by Stone and Youngberg. A couple of quick notes, starting with the fact that
UBS only received retail orders and underwrote approximately $2 million in par amount (which equates to around
50%of the entire issue). Last Wednesday, when I visited Truckee Donner, John Feery, our lead underwriter, was
touring the Eastern Municipal Water District project along with Rose Wang,John Gibson and our research analyst.
Coincidentally, the finance team for Eastern includes John Murphy as bond counsel and Fieldman Rolapp as
financial advisor. Of note, the market was off dramatically on Wednesday with the 10-year treasury increasing by
13 basis points and MMD (a municipal industry scale) being adjusted by 10-14 basis points in many maturities.
When the fact the market was off is compared with the scales at prepricing, it shows how aggressively we
underwrite high quality bonds(Eastern had a 9.5:1 VTL based on appraised value)to retail. Interestingly enough,
we did lose some retail orders (not surprisingly)to nonrated retail buyers who have accounts at both firms. This is
the most similar(identical)comparable we have ever seen.
As shown by the comparisons on the next page,with the exception of the first maturity,our yields were significantly
lower throughout the transaction for both pre-pricing and the final pricing results. Our pricing advantage, or ability
to lock-in lower yields,ranged from 15 to 45 bps during pre-pricing and 5 bps to 40 bps for our final pricing versus
our competitor's results. In the end,our weighted average pricing advantage was 17 bps(5.76%vs. 5,93%arbitrage
yield for Eastern vs. Temecula). In dollar terms, assuming a $10 million issue with a 30-year final maturity and
level debt service, 17 bps equates to savings of around$400,000 in debt service through the life of the issue.
0 UBS
g
VIEW
''Community Facilities District No. 03-01103-02
PRE-PRICING FINAL PRICING RESULTS
MoturiW tI'Ig lw L Couoou .Ytgldg fr ncioni+ Coupon Yleidc Motori Princioai Coma Yi.Id, Princinei S'nuoon Yields
2004 65000 2200% 2.200% 65,000 2.000% 2.000% 0.2W% 2004 65,000 2.200% 2.2W% 65,000 2.000% 2,0001/4 0.2W%
2005 65,000 2,600% 2.60V/. 120,000 2.750eo 2,750% -0,150% 2005 65,OW 2.600% 265W/{ 120,000 2,650°u 2,6501a 0.000%
2006 70,000 3,000% 3.000% 125,000 3.250% 3.250%. -0.250% 2006 70,000 3,000% 1050% 125,W0 3.150% 3,150% -0.1W%
2007 70,OW 3.400% 3AW14 125,000 3750% 3,750% -0.350% 2007 70,000 3,400% 3b50"/o 125,000 1650% 3.650% -0200%
2008 70,OW 3.800% 3.800% 130,000 4,00(VA 4.OW% -0.200e/ 2008 70.000 3,800% 3.850% 130,W0 1900% 3mo% -0.050%
2009 75,000 4,100% 4.100% 135,000 4.400°l 4400°l0 AM% 20091 75,000 4,100% 4.15Qtlo 135,000 4300°/ 4300% -0.150%
2010 75,000 4.400% 4.400% 145,000 4.7500% 4.750% A350% 20101 75,000 4450% 4.450% 145,000 4.650% 4.6501K -0,200%
2011 80,000 4.650% 4,650% 150,000 5.000"(0 5.000% -0.350% 20111 80,000 4,700% 4,700% 150000 4.900% 4.900% .0.2W%
2012 85,000 4,850% 4,850% 155,OW 5.250% 5.250°% -0.400% 2012 80,000 4,900% 49W% I55,WO 5.150% 5.15T% -0.250%
2013 85,OW 5.000% 5.000% 165,000 5.400% 5.400% -0.400% 2013 85A0 5.050% 5,050% 165000 5300°/ 5300% -0150%
2014 90,000 5,100% 5.1001% 175,000 5.550% 5.550% .0.450% 2014 W,000 5,150% 51150% 175,OW 5.450% 5A50°/n -0,300%
2015 95.001) 5.20D% 5,200% 185,000 5.650% 5.650% -0.450% 2015 95,000 5.250% 5.250% 185,000 5.600% 5.6W% -0,350%
2016 100,000 5.300% 5.300% 195,OW 5,750% 5,750% -0.450% 2016 100,OW 5.350% 5.350% 195,W0 5950^tt 5,75V/. -0.400%
2017 105,000 5.400% 5.400°/ 205,W0 5.850"% 5.850% -0.4M 2017 105,000 5.4501K 5.450% 205,000 SA50% 5.850% -0.400%
2018 110W0 5.50W/ 5,500% 21500 5950% 5,950% -OA50% 2018 110,000 5.550% 5550% 215000 5.850% 5olk-A -0.350%
2019 115,000 5.500% 5,60W/ 230,000 6.OW/. 6.000% -0400% 2019 115,000 5.500% 5650°/ 230,W0 595w/. 5.950% 43W%
2020 120,000 5,600% 5650°G 240,WO 6A50% 6.0501% -0.400% 2020 120,000 5.600% 5]00% 240,000 6o00% 6.000% 43W%
2021 255,000 6,100 6.1 W% - 2021 255,WO 60W% 6,02WA -
2022 270,000 6,1505% 6.15v/1 - 2022 270,000 6o501G 6,050%
2023 400,000 5.800% SBW% 2023 4W,000 5,875% 5,875%
2024 - 2024
2025 2025
2026 - 2026
2027 2027 -
2028 2,015,0W 6100% 6.2W96 2028 2,015,000 6,000% 6.070°/
2029 2029
2030 - 2030 -
2031 - 2031 -
2032 - 2032
2033 1,980,000 5.8W% 5,900% 2,315,000 6.250% 6.250% -0.350% 2033 1,89500) 5875% 6000% 2,315,000 6,125% 6.125% -0.125%
URS Fi...QW S.rvieec Stone&Youngberg
'Terne.I.pre-prieing pnodp.N unavailable, Fine)prieing amounts.,ed. Arbione Weed= .76b Arbltrn .Yield=5.93%
MIS Pricing Adrnntnge-17 bp
UBS 9
r4amCommunity Facilities District No. 03-01/03-02
MARKETING AND DISTRIBUTION CAPABILITIES
As equally important as the comprehensive banking services provided to the District is the strength and depth of the
underwriting firm's marketing and distribution capabilities, which will directly affect the overall cost of the
financing. UBS markets and sells all issues to the largest possible investor audience thereby minimizing the cost of
borrowing to the issuer. UBS is able to do so by leveraging its tremendous distribution network on both a local and
national basis as well as its strong ability to access both the retail and institutional investor base. As it pertains to the
District's issue, our ability to place the bonds in the hands of retail buyers is a critical component in achieving the
lowest possible cost.
UBS is one of the few remaining investment banking firms that has a comprehensive distribution network that can
access the entire range of retail and institutional investors. The investors' differing investment goals, needs and
restrictions cause them to respond differently in a given market environment. The Firm's advanced distribution
capabilities and ability to interact with both retail and institutional investors ensures that the Firm will be able to
provide timely and accurate feedback regarding investor perceptions on credit and market data. UBS markets and
sells all issues to the largest possible investor audience, thereby minimizing the cost of borrowing to issuers. Most
importantly, our balanced distribution system allows us to access the capital markets under all market conditions.
For example, in the volatile market in 1999, the retail segment provided liquidity support to the entire municipal
market. UBS will fully leverage its salesforce well in advance of the bond sale to educate investors about the
attractiveness of this issue. The following chart provides an overview of our retail sales organization in California
and Nevada.
California/Nevada Retail Network California and Nevada Distribution
■ 1,365 Retail Financial Advisors in 47 offices
■ $76 Billion in Assets Under Management
■ $12 Billion in Municipal Assets Under Management
■ Offices include Incline village and Reno i
National Retail Network
■ 8,550 Retail Financial Advisors in 391 Offices x
■ Over 4.9 Million Active Retail Accounts and Assets of$462 Billion
■ According to an Industry Survey:
—Ranked t°in Overall Primary Market Productivity for Last 2 Years 'V
—Ranked 2Id in Overall Secondary Market Productivity 2nd Year
in a Row
■ $40 Billion of Municipal Bonds Sold to Retail Customers in 2002
■ 9 Commitment Centers Nationwide • UBS Financial Services Office
■ 25 Municipal Traders
'�Municipal Committing Center
Institutional Distribution Network
UBS' institutional sales force distributes a full line of financial products in the primary and secondary markets,
serving the investment and risk management needs of institutional investors nationwide. Our institutional sales
force services investment assets managed by all types of institutions including mutual funds, casualty companies,
commercial banks, personal trusts, corporations and investment advisors. The institutional salesforce has three
major components - National, Regional and International. With 425 regional institutional sales representatives
across the country covering over 2,000 moderate and smaller size institutions, UBS is well suited to cover the full
spectrum of institutional accounts.
UBS' municipal institutional salesforce of 17 sales people located in nine offices nationwide covers all investment
product sales to large institutions. These offices are located in Los Angeles, Boston, Chicago, New York,
Cleveland,Naples,Minneapolis,Washington D.C.,and Atlanta.
Retail Distribution Network
UBS' domestic retail sales force of 8,550 financial advisors in 391 offices nationwide is one of the largest in the
industry. Our retail division, entrusted with over$462 billion of individual investor assets, represents a client base
of over 4.9 million investors. The Finn's investment executives are responsible for informing and advising these
investors on how to invest,preserve and manage these assets.
UBS' large retail investor asset base,in conjunction with our active municipal retail sales efforts, assures issuers of
ready access to the retail market. UBS' retail sales force sold approximately $40 billion of municipal securities in
2002. The Finn's retail investor base can serve to balance institutional demand during a primary market offering,as
the diversity of investor interests will prevent institutions from controlling the pricing process. In addition, retail
investors significantly expand UBS' ability to provide institutional investors with liquidity in the secondary market.
4�UBS 10
'Community Facilities District No. 03-01103-02
Secondary Market Capabilities
Secondary market making of an issuer's bonds is often overlooked as a component of an underwriter's marketing
and distribution capabilities. The existence of an active secondary market is necessary to maintain the liquidity of
municipal bond investments. To the extent that an investor has confidence that a particular type of bond can be
bought and later easily sold at a fair price in the secondary market,that bond issue will be viewed more favorably by
potential investors. Bonds are therefore issuable at lower interest rates when underwritten by a major firm that
maintains an active secondary market in such securities. We commit to provide a secondary market for the
District's bonds.
UNIQUE UBS INVESTOR COVERAGE
Unlike other major investment banks, UBS has ---_---- ----_-_-- -- ---
taken a deliberate approach in maximizing --- -
investor penetration by blanket covering all
investor segments,as opposed to targeting selected
accounts. While most firms tend to focus a
majority of their marketing efforts on larger
institutional accounts(with assets over$1 billion), ��. ,....
UBS' unique marketing network also covers
smaller mid-tier accounts who are often
overlooked by most firms. This approach of
,..�
extending our marketing outreach to a wider ___
investor audience has generated favorable results
for our municipal clients in terms decreasing the
cost on their financings. In]n sum, UBS'
competitive distribution advantage definitely --- -- ---
. YmmLMG'r.V �- �YMb \mu
provides value-added service to our clients, which --- ----,,,
effectively translates to a tower cost of capital.
Below we provide an overview of UBS' marketing
resources and how we target the various tiers of investors who exist in the municipal marketplace.
UBS covers the four primary categories of buyers through its (i)institutional sales force, which primarily targets
long-term bond investors; (it)municipal sales force, which maintains relationships with its investors regardless of
the type of transaction;and(iii)retail brokers,who cover high-net-worth individuals and small,regional institutions.
• Trades of very large size •Trades of moderate size • Least price sensitive of • Small trades and retail
• Very price sensitive ■ Sophisticated,less price institutional investors buyers
• Active traders sensitive than Tier 1 • Buy and hold accounts • Quality and name driven
. Covered by every Wall investors ■ Very rarely trade ■ Unsophisticated,not price
Street firm • Not active tmders • Quality conscious,at times sensitive
• Large pension funds ■ Covered by most firms name driven ■ Biased towards
• Insurance companies • Small insurance companies ■ Coverage often omitted by "household"or
■ Money managers • Corporations many firms recognizable names
• Small pension funds • Small corporations
• Small bank trust accounts
Large Institutional Coverage. UBS covers Tier I institutional accounts with 17 municipal sales executives located
in New York, Boston,Chicago,Orlando,San Francisco and Los Angeles. A majority of our institutional sales force
has been involved within the municipal bond industry for years,and as such,has developed one-on-one relationships
with all of the major institutional purchasers of municipal bonds.
Small Institutional Coverage:Complementing our large institutional coverage is UBS' Regional Institutional Sales
("RIS") Account Group which markets to over 6,650 smaller institutions, such as regional corporations and trust
departments (Tiers 11 and 111). The RIS group consists of 425 specialized brokers within UBS' extensive branch
network who market financial products to small institutions that do not ordinarily receive coverage from our
institutional sales desk. Through our RIS network, URS is one of the few major investment banks to maintain
significant contact with smaller institutions. These smaller institutions, whose aggregate purchases often constitute
a sizable portion of investor participation in a municipal offering, are frequently overlooked by other major
investment banks.
at UBS ]1
/,�{a,'_��� -„Pt
4'7I1Y' 'Community Facilities District No. 03-01/03-02
Retail Coverage: In addition, the RIS group markets municipal securities to high net worth individuals. Because
municipal bonds are not always understood by the average retail buyer,high net worth individuals with added credit
expertise are the major"retail"purchasers of municipal bonds. UBS' extensive retail distribution network is among
the largest in the securities industry, totaling 8,550 registered representatives located throughout the country. Our
extensive distribution network will enable us to place the Bonds in the hands of retail buyers which is a vital
component of any marketing strategy which seeks to achieve the lowest cost of funds for issuers. Since 1992, our
direct sales to retail investors have more than doubled.
As evidence of this trend, the left hand chart below demonstrates the growth of direct retail sales at UBS over a
twelve year period. Our continued commitment to public finance is based upon the importance of tax-exempt bonds
to our high net worth retail investors. It is anticipated that the individual investor will continue to play an important
role in the placement of tax-exempt bonds in the future, which fits naturally with UBS' extensive retail brokerage
distribution capabilities. UBS brokers average over $200,000 in assets under management per brokerage account,
which is the highest average of any U.S. brokerage firm. Assets under management per active account average over
40%higher than our nearest competitor. The right hand chart above highlights our performance in securing high net
worth accounts versus our other major competitors.
UBS'Primary Retail Sales of Muni Bonds Average Account Size*
1992 to Present Assets per active account
($Billions) ($000s)
$42.0
----- UBS R...ial
— 368
S35.0 30.0 320 m«saasw� n t14
26.5 280 am«e
$28.0 22.5 ss,wm
19.7 20.1 ruwaun�,.K
$21.0 16.8
133 Du Dlan
$14.0 -IDA I1.7
ananam
$7u cram
S0.0 0 50 100 150 200
1992 1993 1994 IW5 i996 IW7 1998 1999 2W0 son 2W2 2003 pap rat available for R Mhlland AG.Edwards.
Est
4. Assuming a bond sale of$10 million for Old Greenwood by the end of the year, what kind ofan underwriting
spread would you propose? Please break your spread down by each component(underwriting, risk, expenses
and management). A range is permissible but your proposed spread will be the basis offznal negotiations and
should be based upon the marketing plan you present.
PROPOSED FEES
Given our strong desire to work with the District and East West Partners, we are proposing an aggressive spread.
We believe the proposed spread is aggressively low but enough to guarantee a strong retail sales effort for the
proposed financing as we have demonstrated to the District's financial advisor over time. Based on an assumed par
of$10 million and a fixed rate nonrated issue,we have provided our proposed gross fee spread below. This fee is a
firm not-to-exceed fee. While based upon the par amount,the timing for sale, and perceived credit quality we can't
imagine asking (and wouldn't) for an increased fee. Please note however, that to guarantee the aggressive retail
pricing we have described herein,we firmly believe that the $10.00 takedown is critical. That is our retail standard
for all Irvine transactions as well as the Eastern pricing of this week.
iSpread Component Amount Per Bond
Average Takedown SI00,000.00 $10.00
Management Fee 0,00 0.00
Underwriting Fee 0.00 0.00
Expenses 14,660.27 1.47
Total Spread $114,660.27 $11.47
Assumes transaction closes before end of year.
04#a UBS 12
fk'"�ifYii'®Lommunity Facilities District No. 03-01/03-02
The table below shows our estimated transaction expenses. We have included the basic expenses for a$10 million
issue. All expenses are capped except for those fees which are calculated based upon bond size(indicated by*}.
Summary of Underwriter Expenses
Expense Component Amount per Mind
Underwriter's Counsel—Feestt' S 0.00 $ 0.000
General Expenses"' 10,000.00 1.000
National PSA Fees* 300.00 0.030
California PSA Fees* 100.00 0.010
CDIAC 1,500.00 0.150
DTC Clearance Fee 336.30 0.034
DALCOMP Charge* 1,850.00 0.185
CUSIPs 300.00 0.030
Day Loan Interest* 273.97 0.027
Total Expenses $14,660.27 $ 1.466
(1) Depending on underwriter's counsel's role(preparation of BPA,POS/OS,etc.),the fee will range from$7,500 to$30,000. We would like m
discuss the decision to utilize underwriter's counsel and/or the expected role of counsel role with the Financial Advisor and the District at a
later time. Clearly,if John Murphy is disclosure counsel and provides a standard IOM opinion,there is a much reduced requirement(if at
all)for underwriter's counsel.
(2) General expenses include UBS'cost for travel,mailings,express deliveries,conference calls,and other miscellaneous expenditures.
UBS 13
/��..
�c''3 ' Community Facilities District No. 03-01/03-02
Appendix A.
CALIFORNIA LAND SECURED EXPERIENCE
As shown below, UBS has extensive experience with senior managing Mello-Roos and Assessment District
transactions, having underwritten 96 issues totaling over$2.63 billion since January I, 1997, many of which were
non-rated issues. Over this period,we've senior managed transactions as small as$0.89 mm to transactions as large
as$510.185 mm with an average transaction size of$27.4 mm.
UBS Senior Managed California Land Secured Experience(CFD and AD Experience)
January 1,1997 to Present
0T16/03 Irvine-Califomia GO Improvement Bonds S 1.905
07/16/03 Irvine-Califomia GO Improvement Bonds 5,695
07/t 1/03 Corona-Norco USD-CFD#00-I Special Tax Bonds,Series 2003 2.690
07/08/03 Irvine Assessment Dt#00-18 Ltd Obligation Improvement Bonds 27220
07/03/03 Corona Comm Fars Di#2000-1 Special Tax Bonds,Series 2003E 1.610
06/I1/03 Irvine Unified SD Adj Rm Special Tax Bonds,Series 2003 92500
0511510-1 Orange Co Comm Facs Or 420024 Special Tax Bonds,Series A of 2003 68.280
04/23/03 Santa Margarita Water Dt Special Tax Bonds,Series 2003 33.145
02/25/03 Omnge Co-California Ltd Obligation Improvement Bonds,Series 2003A 30A00
01/24/03 Irvine Pub Fac&Infm Amh Assessment Polled Ref Rev Bonds,Series C 91.175
01/09/03 Jumpy Community Services Dt Special Tax Bonds,2003 Series A 10.290
11/21/02 Jumper Comm Service Dt#6 Special Tax Bonds,2002 Series A 4.020
1081/02 Capistrano Unified SD Special Tax Bonds,Series 2002 17.605
1029102 Bakersfield Assessment Dt#02.1 Ltd Oblig Improv Bonds 1,940
0927/02 Riverside Unified SD CFD#9 Special Tax Bonds,2002 Series C 2.485
08/29/02 Corona-Norco USD Public Fin Auth Special Tax Revenue Bonds,Series 2002A 11.230
08/13/02 Tustin Unified SO Special Tax Bonds,2002 Series A&B 101.788
08/08/02 bourn Comm Facs Dt#2 Special Tax Bonds,2002 Series A 18.315
08/01/02 Corona Comm Facs Dt#2000-2 Special Tax Bonds,2002 Series A 3.675
07/30/02 Eastem Municipal Water Dt Special Tax Bonds,Series 2002 4.500
07/24/02 lrvine-Califomia Ltd Oblig Improvement Bonds 46.755
07/19/02 Irvine Assessment Or#87-8 General Improvement Bonds.Group Four 2.860
07/19/02 Irvine Assessment Dt#97-16 General Improvement Bonds,Group Five .890
07/17/02 Bakersfield Assessment Dt#01-3 Ltd Oblig Improvement Bonds 5.060
0621/02 Long Beach Community Facs Dt#6 Special Tax Bonds,Series 2002 43.000
06/07/02 Jumper Comm Facs Dt#5 Special Tax Bonds,2002 Series A 3.615
05/03/02 Riverside Unified SD CFD#7 Submit Lien Special Tax Bonds,2002 Series A 8.155
02/28/02 Eastem Municipal Water Dt Water Revenue Bonds 11.665
0222/02 Corona Comm Facs Dt#2000-1 Special Tax Bonds,Series 2002A 6.485
01/31/02 Rancho Mirage Reasse Or#R22085 Ltd Oblig Improvement Ref Bonds,Series 2002 7.625
01/09/02 Irvine Pub Fire&Infra Auth Assessment Revenue Bonds,Series B 57375
12/13/01 Riverside Public Fin Authority- Special Tax Revenue Bonds,Series 2001 A&B 18.350
11/13/01 Irvine Assessment Dt#00-18 Adj Rte Ltd Oblig Improv Bonds,Series A 84.800
10/19/01 Capistrano Unified SD Special Tax Bonds,Series 2001 23.050
10/I1/01 Riverside Unified SD CFD#9 Special Tax Bonds,2001 Series B 2.790
07/26/01 Irvine Assessment Dt#87-8 Ltd Obligation Improvement Bonds 6.040
07/13/01 Irvine-Califomia Ltd Obligation Improvement Bonds,Group Three 36,985
07/11/01 Riverside-Califomia Special Tax Refunding Bonds,Series 2001 A 14,325
0622/01 Irvine Assessment Or#94-13 Ltd Obligation Improv Bonds,Group Three 1.755
0620/01 Irvine Assessment Or#95-12 Ltd Obligation Improv,Bonds,Group Six 2.460
06/14/01 lrvine Assessment IN#00-18 Ltd Obligation Improv Bonds,Group One 9A30
11/08/00 Los Angeles Co Comm Fee Dt#3 Improv Area B Special Tax Bonds,Series 2000 A 24.465
10/18/00 Santaluz Comm Facility Dt#2 Special Tax Bonds,Series B of 2000 4.350
10/I8/00 Senate:Comm Facility Dt#2 Special Tax Bonds.Series A of 2000 56.020
08/17/00 Tustin Unified SD BANs,Series 2000 28.625
08/17/00 Tustn Unified SO Special Tax Bonds,Series 2000 41.515
08/04/00 Irvine-Califomia Limited Obligation burr Bonds,Group Two 2.190
08/04/00 Irvine-Califomia Limited Obligation Improv Bonds,Group Four 7.935
0726/00 Ramona Municipal Water or Lt Obligation Improvement Bonds.2000 Series A 3.355
07/21/00 Irvine-California Ltd Obligation Improvement Bonds,Group Five 2.845
0720/00 lrvine-California Lt Obligation Improvement Bonds,Group Two 1.090
06/28/00 Chino Hills-Califomia Special Tax Bonds,Series 2000 13.040
02/09/00 Elsinore Valley Muni Water IN Special Tax Bonds Series 2000 5.500
SUBS A 1
-- . ..._ ... ,._.........._..._...........
. ......................................
r4mm
'Community Facilities District No. 03-01103-02
UBS Senior Managed California Land Secured Experience(CFD and AD Experience)
Januaq 1, 1997 to Present
Size
IS miis)
Sale Palo Issuer Issue Description
12/21/99 Turlock-Califnmia Special Tax Bonds,Series 1999 $4.640
12/09/99 Corona-Norco USD Com Fac Fit#99-1 Special Tax Bonds,Series 1999 3,515
12/08/99 Elsinore Valley Muni Water Fit Special Tax Bonds,Series 1999 4.000
I1/24/99 Palmdale SD Special Tax Bonds,Series 1999 24.952
10/28/99 Mainers Valley USE)CFD No.99-1 Special Tax Bonds,Series 1999 4.940
08/13/99 El Domdo Co�Califomia Special Tax Bonds,Seres 1999 43.650
07/27/99 Irvine-California Ltd Obligation Improvement Bonds,Group One 6.865
06/24/99 Irvine Assessment Fit#97-17 Ltd Oblig Improvement Bonds,Group One 14,875
06/17/99 lrvme Assessment Fit#94-13 Ltd Obliga Improvement Bonds.Group Two 15.650
06/17/99 Irvine Assessment Dt#95-12 Limited Obligation Improv Bonds,Group Four 5.550
06/17/99 Irvine Assessment Or 99746 Ltd Oblig Improvement Bonds,Group Three 2.005
05/27/99 Roseville-Califnmia Special Tax Refunding Bonds,Series 1999 29.330
05/12/99 Los Angeles Cc Comm Fac Dt#1 Special Tax Refunding Bonds.Series 1999A 6.870
02/12/99 Irvine Public Facs Corp Assessment Revenue Bonds,Series A 66,240
01/19/99 Irvine Assessment Fit#87-8 Ltd Oblig Improvement Bonds,Art Rte Series 74.700
12A6/98 Bonita Canyon Pub Foe Fin Auth Special Tax Bonds,Seres 1998 45.000
11/18/98 Tustin Public Financing Auth Revenue Bonds,Series C 4.185
10/07/98 Tustin Unified SO Special Tax Bonds,Series 1998 64.615
08/13/98 Corona-Norco Unified SD Special Tax Bonds,Series 1998 1.605
08/06/98 Riverside Co Comm Fares Or 989.5 Special Tax Refunding Bonds,Series 1998 19.500
08/06/98 San Marcos Public Fars Auth Refunding Revenue Bonds,Series 1998 33.560
07/17/98 Roseville Finance Authority Local Agency Revenue Bonds,Series A 32.715
07/17/98 Roseville-California Special Tax Refunding Bonds,Series 1998 32.030
07/16/98 San lose City-Califnmia Limited Obligation Reformats,Series 24P 26.880
07/10/98 Sacramento-Califnmia Ltd Obligation Ref Impure Bonds,Series 1999 22.685
07/09/98 Irvine Assessment Fit#94-13 Ltd Oblig Improvement Bonds,Group One 13975
07/09/98 Irvine-Califnmia Ltd Obligation Improv,Bonds 2.279
07/08/98 Irvine Assessment Fit#97-16 Ltd Obligation Improv Bonds 9.555
07/02/98 Irvine Assessment Tit#95-12 Ltd Oblig Improvement Bonds 11,915
06/24/98 San Diego-California Special Tax Refunding Bonds,Series 1998 59.465
06/19/98 West Sacramento-Califnmia Refunding Improvement Bonds,Series 1998 19.972
06/11/98 Los Angeles Co Comm Face Dt#5 Special Tax Refunding Bonds,Series 1998A 12.550
06/02/98 Irvine-Califnmia Limited Oblig Improv Bonds 95.000
11/21/97 Palmdale Elementary SO Special Tax Bonds,Series 1997 7,422
11/06/97 Los Angeles Co Pub Works Fin Au Revenue Bonds,Series 1997 A 510.185
10/23/97 Tustin Public Financing Auth Revenue Bonds,Series B 3300
0929/97 Irvine-California Ltd Oblig Improvement Bonds 60.E
09/29/97 Irvine-Califunia Ltd Oblig Improvement Bonds 6L600
09/18/97 Irvine-Califnmia Limited Oblig Improvement Bonds 3.695
07/29/97 Riverside Co Comm Fares Dt#884 Special Tax Refunding Bonds 28.000
0725/97 Irvine Assessment Dal#95-12 Ltd Obligation Improvement Bonds 4295
05/15/97 Del Norte Co-Califnmia BANS,Series 1997 3.630
04/17/97 Los Angeles Co Comm Fite Dt#3 Improv Area Spec Tax Ref Bonds,Series 1997A 18,575
96 Issues Totaling: $2,630.638
�UBS A 2