Hermosa Beach City Council
June 9, 2026

54 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 10 -
15c3-3 (SEC Rule 15c3-3), client accounts are carried as customer or non-customer accounts and are reported as Receivable from clients and counterparties and Payable to clients and counterparties on the Consolidated Statement of Financial Condition. Balances in securities accounts are regulated by the SEC and balances in commodity accounts, which include futures and other derivative transactions, are regulated by the CFTC. Refer to Note 20 for further information.

Clients’ transactions are recorded on a settlement date basis. In the event clients’ securities trades fail to settle, the Company records the transactions to clients’ accounts as if they settled and reflects a corresponding fail-to-deliver or fail-to-receive in Receivable from broker-dealers and clearing organizations or Payable to broker-dealers and clearing organizations on the Consolidated Statement of Financial Condition.

Amounts receivable from and payable to clients generally include amounts due on cash and margin transactions, or futures related activity. For margin loans and other collateralized customer receivables, the Company calculates and monitors the market value of collateral held to secure receivables from customers on a daily basis and requests additional collateral when the collateral market value falls below certain percentages of the loan balance that ensure that, at a minimum, the collateral value exceeds the loan value. Only highly-liquid securities can be used to collateralize these receivables under regulatory margin requirements and therefore collateral can be easily converted to cash. For futures warrant financing receivables, the receivable balance is collateralized by the warrants purchased by the client in which the Company holds a security interest, the fair value of which must exceed the amount financed by the Company.

Existence of this daily collateral maintenance provision requires that collateral is continually replenished if the fair value of the collateral falls below the amortized cost of the asset. As such, generally no allowance for credit losses is held against these receivables as due to the collateral maintenance provisions, the Company expects zero losses related to these assets.

Certain client trades are executed and cleared through foreign affiliated broker-dealers. In accordance with the Exemption of Certain Foreign Broker or Dealers – SEC Rule 15a-6 (SEC Rule 15a-6), the Company reports clients’ failed trades in Receivable from clients and counterparties or Payable to clients and counterparties, and an offsetting Receivable from broker-dealers and clearing organizations or Payable to broker-dealers and clearing organizations on its Consolidated Statement of Financial Condition.

Securities owned by clients, including those that collateralize margin transactions, and held by the Company for clients in an agency or fiduciary capacity, do not represent assets of the Company and as such are not included on the Consolidated Statement of Financial Condition.

Income taxes
The Company accounts for income taxes under the method prescribed by ASC 740 Income Taxes. Income tax comprises current tax and deferred tax. Deferred tax assets and liabilities are recognized for the expected future tax consequences of existing temporary differences between the financial reporting and tax reporting basis of assets and liabilities using enacted tax laws and rates and tax carryforwards. On a quarterly basis, management evaluates its deferred tax assets to determine if these tax benefits are expected to be realized in future periods. This determination is based on facts and circumstances, including the Company’s current and future tax outlook. To the extent a deferred tax asset is no longer considered more likely than not to be realized, a valuation allowance is established. The Company has no significant unrecognized federal and state tax benefits as of October 31, 2025.

Accrued income taxes represent the estimated amounts due to or from the various taxing jurisdictions where the Company has established a business presence. Accrued income taxes receivable and payable are recorded within Other assets and Accounts payable and accrued liabilities, respectively, on the Consolidated Statement of Financial Condition.

The balance also includes a contingent reserve for potential taxes, interest, and penalties related to uncertain tax positions. On a quarterly basis, management evaluates the contingent tax accruals to determine if they are sufficiently reserved based on a probability assessment of potential outcomes. The determination is based on facts and circumstances, including the interpretation of existing law, new judicial or regulatory guidance, and the status of tax audits. From time to time, there may be differences in opinion with respect to the tax treatment accorded transactions.

If a tax position which was previously recognized on the Consolidated Statement of Financial Condition is no longer more likely than not to be sustained upon a challenge from the taxing authorities, the tax benefit from the tax position will be derecognized. Refer to Note 18 for further information on the Company’s income taxes.

55 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 11 -
Note 4. Securities financing
The following table presents the gross amount of liabilities associated with repurchase agreements and securities lending agreements, disaggregated by class of collateral pledged and by remaining contractual maturity:
1 to 30 31 to 90
$ in thousands Open days days Netting (1) Total
Securities sold under agreements
to repurchase, at fair value:

U.S. and Canadian government and agency obligations 768,397 $ 8,366,381 $ 2,594,939 $ (3,401,025) $ 8,328,692 $ Corporate and other debt 2, 8,940,232 076,172 4,534,511 (3,822,590) 11,728,325 Total 2,844,569 $ 17,306,613 $ 7,129,450 $ (7,223,615) $ 20,057,017 $ Securities loaned:

Corporate and other debt - $ 15,022 $ - $ - $ 15,022 $
Equity securities - 3,179,822 - - 3,179,822
Total - $ 3,194,844 $ - $ - $ 3,194,844 $
Obligation to return securities
received as collateral:

Equity securities - $ 1,425,492 $ - $ - $ 1,425,492 $
(1) Amounts offset with securities financing assets that are not reflected in the table above.

As at October 31, 2025
Offsetting of collateralized financing transactions within the Consolidated Statement of Financial Condition may be achieved where these financial assets and liabilities are subject to master netting arrangements that provide the currently enforceable right of offset and where there is an intention to settle on a net basis, or realize the assets and liabilities simultaneously.

The amount of the financial collateral received or pledged as part of collateralized financing transactions subject to master netting arrangements or similar agreements but not qualified for offsetting refers to the collateral received or pledged to cover the net exposure between counterparties by enabling the collateral to be realized in an event of default or the occurrence of other predetermined events. Certain amounts of collateral are restricted from being sold or repledged unless there is an event of default or the occurrence of other predetermined events.

56 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 12 -
The table below provides the amount of collateralized financing transactions that have been offset on the Consolidated Statement of Financial Condition and the amounts that do not qualify for offsetting but are subject to enforceable master netting arrangements or similar agreements. The amounts presented are not intended to represent the Company’s actual exposure to credit risk. The assets and liabilities are as included in the following table:
$ in thousands
Gross amounts
of recognized
assets and
liabilities
Gross amounts
offset in the
Consolidated
Statement of
Financial
Condition
Net amounts
presented in the
Consolidated
Statement of
Financial
Condition
Gross amount not
offset in the
Consolidated
Statement of
Financial Condition(1) Net amount
Assets
Securities purchased under
agreements to resell, at fair value 19,208,865 $ (7,223,615) $ 11,985,250 $ (11,984,782) $ 468 $ Securities borrowed 12,770,584 - 12,770,584 (12,413,431) 357,153 Securities received as collateral 1,425,492 - 1,425,492 (1,415,817) 9,675 Liabilities
Securities sold under agreements
to repurchase, at fair value 27,280,632 $ (7,223,615) $ 20,057,017 $ (20,048,076) $ 8,941 $ Securities loaned 3,194,844 - 3,194,844 (3,157,884) 36,960 Obligation to return securities
received as collateral - 1,425,492 1,425,492 (1,415,817) 9,675 (1) Represents financial collateral typically comprised of securities.

As at October 31, 2025
The Company pledged certain financial instruments owned to meet margin requirements and to collateralize repurchase agreements and other securities financing activities. At October 31, 2025, the Company pledged $7.4 billion, of which $523.2 million can be sold or repledged to counterparties with re-hypothecation rights and is parenthetically disclosed in Financial instruments owned, at fair value, on the Consolidated Statement of Financial Condition.

Under the Company’s collateralized financing agreements, the Company either receives or provides collateral. In many cases, the Company is permitted to sell or repledge securities received as collateral. The Company may also pledge customers’ securities as collateral for bank loans, securities lending arrangements, or to satisfy margin deposit requirements of various clearinghouses and exchanges. In the event the Company’s counterparty is unable to return the securities pledged, the Company might need to acquire the securities at prevailing market prices. In the case of repurchase agreements, the Company risks holding collateral at a market value less than contract value of the repurchase agreement. To control these risks, the Company monitors the market value of securities pledged and requires adjustments of collateral levels when deemed necessary.

At October 31, 2025, the Company received $34.9 billion of securities collateral under the collateralized financing agreements, which the Company was permitted to sell or repledge. The amount of collateral that was sold or repledged to counterparties with re-hypothecation rights was $17.9 billion. The amount of collateral that was sold or repledged to counterparties without re-hypothecation rights was $14.8 billion.

The Company additionally receives securities as collateral in connection with certain securities for securities transactions in which the Company is the lender. In instances where the Company is permitted to sell or repledge these securities, the Company reports the fair value of the collateral received and the related obligation to return the collateral in the Consolidated Statement of Financial Condition. At October 31, 2025, the Company reported $1.4 billion as Securities received as collateral in the Consolidated Statement of Financial Condition. Collateral received in connection with these securities transactions that was subsequently repledged was approximately $1.4 billion.

In addition, the Company may use securities received as collateral from resale agreements to satisfy regulatory requirements such as SEC Rule 15c3-3 of the Securities Exchange Act 1934. At October 31, 2025, approximately $19.8

57 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 13 -
million of such securities had been segregated in special reserve accounts as required by SEC Rule 15c3-3. Refer to Note 19 for further detail.

Note 5. Receivable from and payable to broker-dealers and clearing organizations Amounts receivable from and payable to broker-dealers and clearing organizations consist of the following:
$ in thousands Receivable Payable
Clearing organizations 2,469,884 $ 69 $
Carry brokers - 53,504
Unsettled regular-way trades, net - 216,938
Securities fail-to-deliver/fail-to-receive 381,321 423,416 Sweep and client investment programs 122,013 51,662
Other 88,799 13,538
Total $ 780,884 3,040,260 $
As at October 31, 2025
The Company is a member of several securities and derivatives clearing organizations. The Company clears proprietary and clients’ transactions through these clearing organizations and other clearing brokers, including affiliates. Amounts receivable from carry brokers represent balances with foreign affiliated RBC entities used for settlement of futures, options, and swap trading and clearing related to non-customer activity.

Clearing organizations and carry broker balances generally include good-faith and margin deposits, as well as continuous net settlement amounts for firm and clients’ trades. Receivables with clearing organizations are due from centralized market counterparties which operate with policies and procedures to ensure the credit protection of amounts owed to their participants.

Unsettled regular-way trades payable represent net amounts payable related to securities transactions that have not yet reached contractual settlement date.

Amounts for securities fail-to-deliver and fail-to-receive represent the contract value of securities transactions that have not been settled. These balances also include amounts related to client trades executed and cleared through foreign affiliates and are reported in accordance with SEC Rule 15a-6. Unsettled trades and fails are generally settled daily, and therefore the amount of unsettled credit exposure in the event of receivables is limited to the amount owed to the Company for a short period of time.

As part of the cash sweep and other client investment programs, the Company recognizes receivables and payables in clearance accounts for funding activities into the programs. As the funds are either swept or deposited into accounts at financial institutions that are fully covered by Federal Deposit Insurance Corporation (FDIC) insurance or maintained at affiliated banks, or are swept into money market funds fully secured by United States treasury securities, the Company estimates no credit losses for the receivable and therefore no allowance for credit losses is recorded. Amounts related to this activity are as presented in the table above. Refer to Note 14 for further detail on the cash sweep and other client investment programs.

58 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 14 -
Note 6. Receivable from and payable to clients and counterparties Amounts receivable from and payable to clients and counterparties consist of the following:
$ in thousands Receivable Payable
Customers:

Securities accounts 2,506,360 $ 1,695,449 $
Futures and commodity accounts 58,118 4,605,107
Cash on delivery/receipt 473,699 176,285
6,476,841 3,038,177
Non-customers:

Securities accounts 13,441,297 1,124,286
Futures and commodity accounts 25,770 1,634,008
2,758,294 13,467,067
Total $ 9,235,135 16,505,244 $
As at October 31, 2025
Balances are classified as customer or non-customer pursuant to SEC Rule 15c3-3.

Receivables from and payables to customers and non-customers, including affiliates, generally include amounts due on cash and margin accounts. Amounts in clients’ securities accounts relate to securities transactions and amounts in futures and commodity accounts relate to futures, options and other derivative transactions, as well as customer financing receivables in connection with futures clearing activities.

Certain clients are counterparties to firm and other client trades. These trades are generally settled on a cash on delivery/cash on receipt basis. The balances in these accounts represent the proceeds of securities transactions that have not been delivered or received on settlement dates.

Clients’ securities held by the Company are not reported on the Consolidated Statement of Financial Condition.

59 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 15 -
Note 7. Fair value of financial instruments
The following table presents the fair value of assets and liabilities measured at fair value on a recurring basis and classified using the fair value hierarchy:

Assets/
liabilities
$ in thousands Level 1 Level 2 Level 3 Netting (2) at fair value Financial assets:

Securities purchased under agreements to resell $ - $ 19,208,865 -$ $ (7,223,615) $ 11,985,250 Securities borrowed - 113,013 - - 113,013
Financial instruments owned, at fair value:

Commercial paper and certificate of deposits - 2,136,781 - - 2,136,781 U.S. and Canadian government and agency obligations 170 1,189,743 - - 1,189,913 State and municipal obligations - 1,476,305 - - 1,476,305 Corporate and other debt obligations - 3,770,299 - - 3,770,299 Mutual fund investments (1) - 2,009,074 - - 2,009,074
Equity securities 1,420,545 3,086 - - 1,423,631
Derivative related assets - 34,820 - (1,822) 32,998
Total financial instruments owned, at fair value 3,429,789 8,611,034 - (1,822) 12,039,001 Total assets $ 3,429,789 $ 27,932,912 -$ $ (7,225,437) $ 24,137,264 Financial liabilities:

Short-term borrowings $ - $ 5,987,568 -$ $ - $ 5,987,568 Securities sold under agreements to repurchase - 27,280,632 - (7,223,615) 20,057,017 Financial instruments sold, but not yet purchased, at fair value:

Commercial paper and certificate of deposits - 122,944 - - 122,944 U.S. and Canadian government and agency obligations 384,561 653,829 - - 1,038,390 Corporate and other debt obligations - 1,785,232 - - 1,785,232 Equity securities 1,479,825 160 - - 1,479,985
Derivative related liabilities - 9,952 - (1,822) 8,130
Total financial instruments sold at fair value 1,864,386 2,572,117 - (1,822) 4,434,681 Total liabilities $ 1,864,386 $ 35,840,317 -$ $ (7,225,437) $ 30,479,266 (1) Includes $2.0 billion of investments related to deferred compensation plans, see Note 13. (2) Amounts represent netting permitted under U.S. GAAP requirements.

Fair value measurements using
As at October 31, 2025
The Company pledged certain financial instruments owned to meet margin requirements and to collateralize repurchase agreements and other securities financing activities. Refer to Note 4 for further detail.

Valuation techniques
Fair value of assets and liabilities measured at fair value on a recurring basis are determined and classified in the fair value hierarchy table using the following techniques and inputs.

Securities borrowed or purchased under resale agreements, securities loaned or sold under repurchase agreements, and short-term borrowings
The fair value of resale and repurchase agreements and short-term borrowings are determined using valuation techniques such as the discounted cash flow models using interest rate curves as inputs. They are classified as Level 2 instruments as the inputs are generally observable.

Commercial paper and certificates of deposit
The fair value of commercial paper is estimated using broker quotes that utilize observable market inputs and are generally classified as Level 2. The fair value of certificates of deposit is estimated using yield curves and credit spreads, where available, and classified as Level 2 of the fair value hierarchy. The yield curves and spreads are from actively quoted markets and can be validated through external sources, including brokers, pricing services, and market transactions.

60 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 16 -
U.S. and Canadian Government and Agency obligations
U.S. and Canadian Government and Agency obligations includes government debt securities and strips, as well as agency issued mortgage-backed securities (MBS). The fair values of government issued or guaranteed debt securities in active markets are determined by reference to recent transaction prices, broker quotes, or third-party vendor prices and are classified as Level 1 in the fair value hierarchy. The fair value of securities not traded in active markets are based on either security prices, or valuation techniques using implied yields and risk spreads derived from prices of actively traded and similar government securities. Securities with observable prices or rate inputs as compared to transaction prices, dealer quotes or vendor prices are classified as Level 2 in the hierarchy.

State and municipal obligations
State and municipal obligations includes state and municipal debt securities. The fair values of state and municipal bonds are determined using either recently executed transaction prices, broker quotes, or pricing services. Securities with observable prices or rate inputs as compared to transaction prices, dealer quotes or vendor prices are classified as Level 2 in the hierarchy.

Corporate and other debt obligations
Corporate and other debt obligations includes corporate debt securities, MBS, and asset-backed securities (ABS), which include collateralized loan obligations. The fair value of corporate debt is estimated using market price quotations (where observable), bond spreads, or credit default swap spreads adjusted for any basis differences between cash and derivative instruments. Inputs for valuation of MBS and ABS are, when available, traded prices, dealer or lead manager quotes, broker quotes and vendor prices of the identical securities. When prices of identical securities are not readily available, the industry standard models are used, with inputs such as discount margins, yields, default, prepayment and loss severity rates that are implied from transaction prices, dealer quotes or vendor prices of comparable instruments.

Securities with observable prices or inputs as compared to transaction prices, dealer quotes or vendor prices, are classified as Level 2 in the hierarchy.

Mutual fund investments
Mutual funds are valued using the published net asset value (NAV) of the fund. Since pricing information is readily available on an on-going basis, such securities are categorized as Level 1 of the fair value hierarchy.

Equity securities
Equity securities consist of listed common shares and preferred securities. Exchange-traded securities are generally valued based on quoted prices from an exchange. The fair values of common shares are based on quoted prices in active markets, where available, and are classified as Level 1 in the hierarchy. Where quoted prices in active markets are not readily available, fair value is determined based on quoted market prices for similar securities or through valuation techniques, such as multiples of earnings and the discounted cash flow model with forecasted cash flows and discounted rate as input. If the securities are not listed, not actively traded, or restricted, they are generally categorized as Level 2 of the fair value hierarchy. Private equities are classified as Level 3 in the hierarchy as their inputs are not observable.

Derivatives
The fair values of exchange-traded derivatives, such as interest rate and equity options and futures, are based on quoted market prices and are generally classified as Level 1 in the fair value hierarchy. A derivative instrument is classified as Level 2 in the fair value hierarchy if observable market inputs are available or the unobservable inputs are not significant to the fair value. Over-the-counter derivatives primarily consist of interest rate swaps and forwards, equity swaps and options, and credit default swaps. The fair values of over-the-counter derivatives classified as Level 2 in the fair value hierarchy is determined using valuation models when quoted market prices or third-party consensus pricing information are not available. The valuation models, such as discounted cash flow model or Black-Scholes option model, incorporate observable or unobservable inputs for interest and foreign exchange rates, equity and commodity prices (including indices), credit spreads, corresponding market volatility levels, and other market-based pricing factors. Other adjustments to fair value include bid-offer, credit valuation adjustments, funding valuation adjustments, overnight index swap, parameter and model uncertainties, and unrealized gain or loss at inception of a transaction.

Derivative transactions
The Company enters into derivatives to satisfy the needs of its customers and to manage the Company’s exposure to risk resulting from its trading activities and deferred compensation plans. The Company uses industry standard derivative contracts whenever appropriate.

61 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 17 -
Derivatives with a positive fair value are reported in Financial instruments owned, at fair value, and derivatives with a negative fair value are reported in Financial instruments sold, but not yet purchased, at fair value on the Consolidated Statement of Financial Condition. These balances generally represent future commitments to exchange payment streams based on contract or notional amounts, or to purchase or sell physical assets at specified terms on a specified date.

Derivatives netting within the Consolidated Statement of Financial Condition may be achieved where derivative contracts are subject to master netting arrangements that provide the currently enforceable right of offset and where there is an intention to settle on a net basis, or realize the assets and liabilities simultaneously. As at October 31, 2025 there were no derivative contracts that were subject to enforceable master netting arrangements or similar agreements that did not qualify for offsetting within the Consolidated Statement of Financial Condition.

The following table sets forth the fair value and notional amounts of open derivative contracts:

Positive Negative Aggregated
$ in thousands fair value fair value notional
Held for trading purposes
Interest rate contracts:

Forward agreements 8,799 $ 9,944 $ 16,097,188 $
Options 85 - 7,670
Equity contracts:

Options - 8 99
9,952 8,884 16,104,957
Not held for trading purposes
Equity contracts:

Options - - 3,000
Swaps (1) - 25,936 955,356
Gross Balances 34,820 9,952 17,063,313
Netting (2) (1,822) (1,822)
Net Balances 32,998 $ 8,130 $ 17,063,313 $
(1) Derivatives entered into with an affiliate to economically hedge deferred compensation - Refer to Note 13. (2) Represents TBAs that have been netted on the Consolidated Statement of Financial Condition.

As at October 31, 2025
In addition to the derivative amounts above, the Company had open aggregate notional futures contracts of $2.4 billion.

The Company’s futures contracts, with commitments to buy or sell equity indexes, interest rate and currency contracts, are executed on exchanges, and cash settlement occurs on a daily basis. As at October 31, 2025, the net unsettled open trade equity for futures contracts totaled a loss of $0.8 million and is included in Receivable from broker-dealers and clearing organizations on the Consolidated Statement of Financial Condition. The notional amounts presented are not intended to represent the Company’s actual exposure to credit risk.

Certain financial instruments are used to economically hedge certain deferred compensation plans. Financial instruments held for these purposes consist of mutual fund investments and RBC equity securities with a fair value of $2.0 billion and derivative related assets with a fair value of $25.9 million.

There were no assets or liabilities measured at fair value on a nonrecurring basis during the year ended October 31, 2025.

62 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 18 -
Financial instruments not measured at fair value
The carrying amounts and fair values of other financial assets and financial liabilities not measured at fair value in the Consolidated Statement of Financial Condition are as follows:

Carrying Estimated
$ in thousands value fair value Level 1 Level 2 Level 3 Financial assets
Cash 471,042 $ 471,042 $ 471,042 $ - $ -$
Cash segregated for regulatory purposes 5,726,227 5,726,227 5,726,227 - - Securities borrowed (1) 12,657,571 12,657,571 - 12,657,571 - Securities received as collateral 1,425,492 1,425,492 1,425,492 - - Receivable from broker-dealers and clearing organizations 3,040,260 3,040,260 3,040,260 - - Receivable from clients and counterparties 16,505,244 16,505,244 16,505,244 - - Other assets (2)(3) 1,420,340 1,373,888 - 1,356,817 63,523 Financial liabilities
Short-term borrowings (4) $ 5,426,349 5,426,349 $ - $ 5,426,349 $ -$ Long-term borrowings 4,100,000 4,100,000 - 4,100,000 -
Securities loaned 3,194,844 3,194,844 3,194,844 - -
Obligations to return securities received as collateral 1,425,492 1,425,492 1,425,492 - - Payable to broker-dealers and clearing organizations 780,884 780,884 780,884 - - Payable to clients and counterparties 9,235,135 9,235,135 9,235,135 - - Accounts payable and accrued liabillities (5) 576,408 576,408 - 576,408 - Subordinated borrowings 1,386,000 1,308,409 - 1,308,409 - (1) Securities borrowed of $113.0 million recorded at fair value, and are not included above. (2) Other assets of $2.0 billion are not in scope for disclosure, and are not included above. (3) Level 3 Other assets consist of exchange ownership interests.

Fair value measurement
(4) Short-term borrowings of $6.0 billion from Bedford Row are recorded at fair value, and are not included above.

As at October 31, 2025
(5)
Accounts payable and accrued liabilities of $1.2 billion are not in scope for disclosure, and are not included above.

With the exception of subordinated borrowings and exchange ownership interests, carrying value generally approximates fair value of assets and liabilities in the above table. This is due to the relatively short period of time between their origination and expected maturity. These items are generally classified in Level 2 of the fair value hierarchy. Long-term borrowings’ carrying value approximates fair value as contractually the borrowings can be repaid by the Company to the lender at any time.

In the case of subordinated borrowings, the discounted cash flow is used in the calculation of fair value. The credit spread and interest rate are inputs in calculating fair value. These are classified as Level 2 within the fair value hierarchy.

Note 8. Goodwill and intangible assets
Goodwill is reflected in the table below:

Goodwill asset Accumulated amortization/ Net carrying
$ in thousands impairment value
Balance as at November 1, 2024 $ 1,779,497 $ (32,947) $ 1,746,550 Additional goodwill recognized during 2025 - - -
Impairment losses during 2025 - - -
Balance as at October 31, 2025 $ 1,779,497 $ (32,947) $ 1,746,550 Goodwill and exchange membership seats are reviewed for impairment annually as of July 31, 2025. In order to perform the goodwill impairment review, the method the Company uses to estimate the fair value of its reporting units (RUs) is the income approach utilizing a discounted cash flow (DCF) model. The model projects cash flows for the forecast period and uses the perpetuity growth method to calculate terminal values. These cash flows and terminal values are then discounted using an appropriate discount rate. Significant judgment is involved in estimating the model inputs used to determine the fair value of a RU, in particular projected cash flows, discount rates, and terminal growth rates given

63 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 19 -
the uncertainties relating to the timing and amount of these cash flows. Projections of cash flows are based on financial plans agreed by management, which are estimated based on forecasted results, business initiatives, and planned capital investments. Discount rates are based on RBC’s cost of capital, adjusted for RU-specific risks, and currency exposure as reflected by differences in expected inflation. RU-specific risks include business/operational risk, geographic risk (including political risk, devaluation risk, and government regulation), and other RU-specific risks. Terminal growth rates reflect the expected long-term growth rate for the Company’s RUs (including asset and liability growth rates), rates of inflation and gross domestic product growth rates for the countries within which the RU operates.

Changes in the assumptions used for valuation may impact the estimated fair values of the Company’s RUs or their associated goodwill. Upon disposal of a portion of a RU, the carrying amount of goodwill relating to the portion of the RU sold is included in the determination of gains or losses on disposal. The carrying amount is determined based on the relative fair value of the disposed portion to the total RU.

Intangible assets are reflected in the table below:

Gross carrying Accumulated amortization/ Net carrying
$ in thousands value impairment value
Client relationships 1,317 $ (728) $ 589 $
Exchange membership seats 5,810 (3,063) 2,747
Total 7,127 $ (3,791) $ 3,336 $
As at October 31, 2025
Note 9. Fixed assets
The Company’s fixed assets consist of the following:
$ in thousands Cost
Accumulated
amortization and
depreciation Net book value
Internally-developed software $ 685,445 $ (270,054) $ 415,391 ROU assets 944,581 (474,173) 470,408
Computers and equipment 311,943 (195,493) 116,450
Leasehold improvements 454,141 (287,289) 166,852
Other fixed assets 1,162 - 1,162
Total $ 2,397,272 $ (1,227,009) $ 1,170,263
As at October 31, 2025
Note 10. Other assets and Accounts payable and accrued liabilities Other assets
Other assets consist of the following:
$ in thousands As at October 31, 2025
Loan receivables, net $ 1,689,200
Fee receivables 160,115
Other intergroup receivables (see Note 14) 125,206
Prepaid and deferred charges 129,918
Interest and dividend receivables 292,677
Deferred income taxes, net 860,074
Other receivables 158,505
Total other assets $ 3,415,695

64 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 20 -
Loan receivables, net consist of staff loans made to financial advisors and other employees which are provided as an incentive to join or to remain with the Company.

Fee receivables mainly include accrued fees in connection with underwriting, investment management, and other client asset servicing. These receivables are typically due within 30 to 90 days and are due mainly from underwriting syndicate lead bookrunners which are institutional capital markets participants, with whom the Company maintains an ongoing business relationship, and investment advisory and other customers of the Company where the Company or a third party holds the client’s securities and cash in the client account.

Prepaid and deferred charges largely include funds advanced to third-party service providers to cover rent, market data and other communications costs, as well as commissions and employee benefits prepaid to financial advisors.

Interest and dividend receivables mainly include accrued interest and dividends from long trading securities, reverse repos and securities borrowed. Approximately $48.2 million of accrued interest receivables are with affiliates. Refer to Note 14 for further detail.

Refer to Note 18 for further detail around deferred income taxes.

Other receivables include various miscellaneous receivables, including lease receivables, certain tax receivables, exchange shares, and certain staff related receivables.

Accounts payable and accrued liabilities
Accounts payable and accrued liabilities consist of the following:
$ in thousands As at October 31, 2025
Operating lease liabilities $ 561,738
Syndicate payables 54,372
Deferred income 441,651
Interest and dividend payables 250,789
Other intergroup payables (see Note 14) 141,925
Other liabilities 331,944
Total accounts payable and accrued liabilities 1,782,419 $ Operating lease liabilities represent the obligation to make lease payments arising from the ROU asset.

Syndicate payables include amounts payable to third parties for participating in underwriting syndication deals.

Deferred income includes fees connected with soft dollar arrangements and asset management fees that were billed and received in advance.

Interest and dividend payables mainly include accrued interest and dividends from short trading securities, repos and securities loaned. Approximately $100.0 million of accrued interest payables are with affiliates. Refer to Note 14 for further detail.

Other liabilities include accrued litigation provisions and various miscellaneous payables, including tax payables, asset retirement obligations for leasehold improvements, escheatment payables and other accrued expenses. Accrued litigation provisions represent amounts the Company maintains for outstanding legal matters. The Company accrues for litigation related liabilities when it is probable such liability has been incurred and the amount of the loss can be reasonably estimated. Refer to Note 16 for further discussion on litigation matters.

65 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 21 -
Note 11. Borrowings
Short-term borrowings
The Company entered into various borrowing arrangements to meet short-term financing needs. Short-term borrowings consist of the following arrangements:

Total
$ in thousands facility Borrowings
Secured revolving loan agreement entered into with an affiliate that allows the Company to borrow cash under a series of arrangements with remaining maturities of less than 365 days. Facility expires in December 2027. At October 31, 2025, outstanding borrowings, which are carried at fair value, bear interest at varying rates ranging from 4.05% to 4.53% and are secured by securities with fair value of $6.1 billion. $ 15,000,000 $ 5,987,568
Committed revolving credit agreement entered into with RBC to manage short-term liquidity needs. Agreement matures in June 2026 and bears interest at Daily Compounded Secured Overnight Financing Rate (SOFR) plus

0.90%.
2,500,000 -
Uncommitted revolving credit agreement entered into with RBC to manage short-term liquidity needs.

Agreement matures in September 2026 and the applicable interest rate for any loan is determined by the lender on the date a loan is requested.
8,400,000 5,300,000
Uncommitted revolving facility entered into with Holdco to manage short-term liquidity needs. Agreement has an open maturity with the clause that if drawn, the payment is due upon the call of the lender or within 24 months, whichever comes first. Facility bears interest at SOFR plus margin mutually agreed to by both parties when drawn.
2,300,000 -
Uncommitted credit facility entered into with RBC London Branch to facilitate the settlement of foreign exchange transactions. Agreement matures in June 2028 and interest rates are calculated based on internal funds transfer rate to reflect money market conditions in each currency. 150,000 113,718
Floaters issued by consolidated VIEs in the TOB program discussed in Note 15. Floaters, which are issued to third-party investors, are secured.
- 11,995
Overdraft balances in various non-affiliated bank accounts. - 636 Total $ 28,350,000 $ 11,413,917
As at October 31, 2025
The Company also maintains certain uncommitted overnight credit facilities with various non-affiliated banks to clear and facilitate various securities transactions. As at October 31, 2025, the facilities totaled $1.0 billion and there were no outstanding borrowings.

Long-term borrowings
The long-term borrowings at October 31, 2025 consist of the following arrangements:

Total
$ in thousands Facility Borrowings
Uncommitted credit facility entered into with RBC Finance (Ireland) DAC to manage long-term liquidity needs.

Agreement matures in April 2030. The facility bears interest equal to SOFR plus 2.30%. $ 1,000,000 1,000,000 $
Uncommitted credit facility entered into with RBC Finance (Ireland) DAC to manage long-term liquidity needs.

Agreement matures in October 2028. The facility bears interest equal to SOFR plus 2.05%. 1,000,000 1,000,000
Uncommitted credit facility entered into with RBC Finance (Ireland) DAC to manage long-term liquidity needs.

Agreement matures in September 2029. The facility bears interest equal SOFR plus 1.66%. 1,000,000 1,000,000
Uncommitted term facility entered into with Holdco to manage long-term liquidity needs. Agreement matures in June 2029. The facility bears interest equal to SOFR plus 1.43%. 750,000 750,000
Uncommitted credit facility agreement entered into with RBC Finance (Ireland) DAC to manage long-term liquidity needs. Agreement matures in January 2030 and bears interest equal to SOFR plus 1.60%. 350,000 350,000
Total $ 4,100,000 4,100,000 $
As at October 31, 2025

66 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 22 -
Subordinated borrowings
The borrowings under subordination agreements at October 31, 2025, are as follows:
$ in thousands As at October 31, 2025
Subordinated debt entered into on March 2, 2012 with Holdco. The loan is non-interest bearing and matures in March 2027.

The loan contains an automatic rollover provision whereby the maturity date will be extended an additional year. $ 1,386,000
Total $ 1,386,000
All subordinated borrowings are covered by agreements approved by Financial Industry Regulatory Authority (FINRA) and are available for computing the Company’s net capital pursuant to the SEC net capital rule. To the extent such liabilities are required for the Company’s continued compliance with minimum net capital requirements, they may not be repaid. Refer to Note 19 for further discussion on regulatory matters.

Note 12. Member’s equity
The Company has 200,200 common shares issued and outstanding, of which 100% are owned by Holdco.

Note 13. Deferred compensation plans
Wealth Accumulation Plan
The Company maintains a non-qualified deferred compensation plan for key employees under an arrangement called the RBC U.S. Wealth Accumulation Plan. Under the WAP, employees may elect to index their deferred compensation with various mutual funds or RBC common shares. The Company records an obligation for the vested portion of the amounts owed to employees in Accrued compensation on the Consolidated Statement of Financial Condition and the liability is indexed to the market value of the mutual funds or RBC common shares at the end of the reporting period.

The Company economically hedges its exposure by purchasing mutual funds that provide similar returns to the mutual funds selected by the employees as well as RBC common stock to hedge deferred compensation indexed to the market value of RBC common stock. Mutual funds and RBC common stock purchased by the Company are reported at fair value in Financial instruments owned, at fair value on the Consolidated Statement of Financial Condition.

The Company also enters into total return swaps (TRS) with affiliates to economically hedge its exposure on deferred compensation tracked against RBC common shares. Under the swap agreements, the Company pays interest to the counterparty at a rate based on SOFR plus a spread of 0.92% to 1.15% on the notional value in exchange for receiving the total rate of return on RBC’s common stock on the notional value. The fair value of the TRS is reported in Financial instruments owned, at fair value if in a gain position, and Financial instruments sold, but not yet purchased, at fair value if in a loss position, on the Consolidated Statement of Financial Condition.

The table below summarizes the WAP accrued compensation liabilities and the related hedges:
$ in thousands As at October 31, 2025
Economic hedges
Mutual fund investments $ 1,993,760
Equity contracts - swaps (notional amount of $283.5 million) 17,097 RBC common stock 1,200
Total $ 2,012,057
Accrued compensation liability
Accrued compensation $ 2,128,610
Total $ 2,128,610
Performance Deferred Share Units Plan (PDSP)
The Company offers performance deferred share plans to certain key employees, all of which vest at the end of three years from grant date. Upon vesting, the award is paid in cash and is based on the original number of RBC’s common

67 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 23 -
share units granted plus accumulated dividends and is valued using the average closing price of RBC’s common shares during the five trading days immediately preceding the vesting date. A portion of the award under certain plans may be increased or decreased up to 25%, depending on RBC’s total shareholder return compared to a defined peer group of global financial institutions. The liability on this plan as at October 31, 2025 was $85.2 million and is included in Accrued compensation on the Consolidated Statement of Financial Condition.

RBC Share Unit Program
The Company offers the RBC Share Unit Program, similar to the PDSP, where an award is paid in cash and based on the original RBC share units granted plus accumulated dividends, however, awards granted under the RBC Share Unit Program can be granted at any time during the year and have no fixed vesting period. The Company’s liabilities for the awards granted under the RBC Share Unit Program are indexed to the market value of RBC’s common shares at the end of the reporting period. The liability on these plans as at October 31, 2025 was $15.0 million and is included in Accrued compensation on the Consolidated Statement of Financial Condition.

Deferred compensation
The Company has a deferred bonus plan for certain key employees. Under this plan, a percentage of each employee’s annual incentive bonus is deferred and accumulates dividend equivalents at the same rate as dividends on RBC’s common shares. The awards are paid out generally at the end of three years, although there is no substantive vesting period. The value of the deferred bonus paid will be equivalent to the original deferred bonus adjusted for dividends and changes in the market value of RBC’s common shares at the time the bonus is paid. The value of the deferred bonus liability as at October 31, 2025 was $532.0 million and is included in Accrued compensation on the Consolidated Statement of Financial Condition.

Note 14. Related party transactions
The related party balances set forth in the tables below resulted from transactions between the Company and affiliates in the normal course of business as part of its trading, clearing, financing, and general operations.

Amounts included in the Consolidated Statement of Financial Condition relating to balances with affiliates are set forth as follows:
$ in thousands
Assets:

Cash segregated for regulatory purposes $ 698,317
Securities purchased under agreements to resell, at fair value 14,331 Securities borrowed 565,664
Receivable from broker-dealers and clearing organizations 86,809 Receivable from clients and counterparties 13,194,652
Financial instruments owned, at fair value 30,068
Other assets (Note 10) 173,437
Liabilities:

Short-term borrowings (Note 11) $ 11,401,286
Long-term borrowings (Note 11) 4,100,000
Securities sold under agreements to repurchase, at fair value 3,220,473 Securities loaned 815,223
Payable to broker-dealers and clearing organizations 12,554 Payable to clients and counterparties 2,962,443
Financial instruments sold, but not yet purchased, at fair value 3,760 Accounts payable and accrued liabilities (Note 10) 241,890 Subordinated borrowings (Note 11) 1,386,000
As at October 31, 2025

68 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 24 -
Banking activities
The Company maintains certain accounts at affiliated banks or affiliated broker-dealers to segregate customer funds for regulatory purposes and to settle certain transactions in foreign currencies. There were no segregated customer funds held at affiliated banks, however the Company did hold segregated funds at certain affiliated broker-dealers at October 31, 2025 as reflected in the table. Amounts held at affiliated banks or affiliated broker-dealers to segregate customer funds are reported in Cash segregated for regulatory purposes on the Consolidated Statement of Financial Condition.

Brokerage activities
The Company clears client and firm futures transactions in foreign markets through affiliated clearing broker-dealers.

Third party client-related balances at affiliated foreign broker-dealers are segregated for regulatory purposes and are reported in Cash segregated for regulatory purposes on the Consolidated Statement of Financial Condition. At October 31, 2025, amounts receivable from affiliated foreign broker-dealers for third party clients are as reflected in the table.

At October 31, 2025, amounts receivable from affiliated foreign broker-dealers for firm transactions totaled $53.5 million and are reported in Receivable from broker-dealers and clearing organizations on the Consolidated Statement of Financial Condition. Refer to Note 5 for further detail.

At times, affiliated broker-dealers are counterparties to trades executed by the Company. In the event these trades fail to settle on the contractual settlement date, outstanding receivables or payables are reported in Receivable from brokerdealers and clearing organizations and Payable to broker-dealers and clearing organizations on the Consolidated Statement of Financial Condition. At October 31, 2025, receivables and payables related to fails totaled $33.3 million and $12.6 million, respectively.

The Company provides securities and futures execution, clearance, and custody services to affiliates. Receivables and payables in connection with these services are reported in Receivable from clients and counterparties and Payable to clients and counterparties on the Consolidated Statement of Financial Condition. Outstanding balances at October 31, 2025 are as reflected in the table above.

The Company provides a sweep program, unless the client opts out of the program, through which un-invested cash balances in clients’ brokerage accounts are automatically transferred into either money market funds or deposits at thirdparty banks as well as affiliated banks, such as City National Bank and RBC Bank Georgia, N.A. The Company also offers a discretionary deposit program where client funds are deposited with banks. The affiliated banks pay interest to clients on these deposit accounts. Certain accounts are FDIC-insured up to $250 thousand. The amount of excess cash swept or deposited into these investment products is not reported on the Consolidated Statement of Financial Condition and is not included in the computation for determination of reserve requirements pursuant to SEC Rule 15c3-3 as client dollars are the obligations of the respective institutions and the money market funds are an investment option that represents customer-owned securities.

Derivative activities
The Company enters into certain derivative transactions with affiliates to facilitate clearing of transactions with certain exchanges, as part of trading securities on an extended-settlement basis, and to economically hedge trading activities and certain deferred compensation liabilities. Derivative fair values with affiliates are reported in Financial instruments owned, at fair value and Financial instruments sold, but not yet purchased, at fair value on the Consolidated Statement of Financial Condition. Outstanding balances at October 31, 2025 are as reflected in the table above.

Collateralized financing activities
The Company enters into resale and repurchase agreements with affiliates under master repurchase agreements. Resale agreements, which are entered into primarily to facilitate client activities and to cover short sales, are reported in Securities purchased under agreements to resell, at fair value on the Consolidated Statement of Financial Condition and are as set forth in the table above. Repurchase agreements, which are entered into for financing purposes, are reported in Securities sold under agreements to repurchase, at fair value on the Consolidated Statement of Financial Condition and are as set forth in the table above.

The Company also enters into securities borrow and securities loan agreements with affiliates under securities lending agreements. Securities borrow activities, which are entered into for short sales and other financing activities, are reported in Securities borrowed on the Consolidated Statement of Financial Condition and are as set forth above. Securities loan activities, which are entered into for financing purposes, are reported in Securities loaned on the Consolidated Statement of Financial Condition and are as set forth in the table above.

69 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 25 -
Borrowings
The Company also enters into short-term and long-term borrowings with affiliates. These borrowings are reported in Short-term borrowings, Long-term borrowings, and Subordinated borrowings on the Consolidated Statement of Financial Condition and are discussed in Note 11.

Other assets and accounts payable and accrued liabilities in the table above include amounts receivable from and payable to affiliates for the various activities discussed above and other reimbursements for payments the Company made on behalf of affiliates.

Note 15. Variable interest entities
Consolidated VIEs
A VIE is an entity in which the equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. The entity that consolidates a VIE is known as the primary beneficiary, and is the entity with (1) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (2) has an obligation to absorb losses or the right to receive benefits that in either case could potentially be significant to the VIE.

The Company consolidates VIEs of which it is the primary beneficiary. The Company performs qualitative, and in certain cases, quantitative, analyses to determine whether the Company is the primary beneficiary of a VIE based on the facts and circumstances and the Company’s interest(s) in the VIE.

The Company sold certain municipal bonds into TOB programs, where each TOB program consists of a bond that is credit-enhanced by RBC and purchased by a TOB trust. As at October 31, 2025, there is a TOB trust holding $10.9 million in municipal bonds which the Company consolidates. The TOB trust is a VIE. The bond sold to the TOB program is supported by a letter of credit issued by RBC, which requires an affiliate to extend funding if there are any credit losses on the bond, which is financed by the issuance of floating-rate certificates to short-term investors and a residual certificate. The Company holds the residual certificate issued by this TOB program, which exposes the Company to interest rate basis risk. The Company is the remarketing agent for certain floating-rate certificates and RBC provides liquidity facilities to the TOB program to purchase any floating-rate certificates that have been tendered but not remarketed. The Company consolidates the TOB VIE in which the Company is the holder of the residual certificate as the Company has the power to direct the significant activities of the VIE and is exposed to losses that could be potentially significant to the TOB VIE.

The assets and liabilities of the consolidated VIE recorded in the Company’s Consolidated Statement of Financial Condition are as follows:

As at October 31, 2025
Municipal
$ in thousands TOB trust
Consolidated assets: (1)
Financial instruments owned, at fair value $ 10,853
Other assets 36
Total assets $ 10,889
Consolidated liabilities:

Short-term borrowings $ 12,000
Accounts payable and accrued liabilities 36
Total liabilities $ 12,036
(1) Investors do not have recourse to the Company’s general assets, unless the Company breaches its contractual obligations related to this VIE.

Note 16. Commitments, contingent liabilities, and leases Securities transactions
At October 31, 2025, the Company had commitments to enter into future resale and repurchase agreements. At October 31, 2025, commitments in connection with resale agreements totaled $12.5 billion and commitments for repurchase

70 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 26 -
agreements totaled $1.9 billion. In addition, the Company has entered into certain resale transactions with a contract value of $28.9 million, which had a settlement date for the open leg prior to October 31, 2025 but due to a fail-to-receive were not reflected on the Consolidated Statement of Financial Condition at October 31, 2025.

The Company has also sold securities that it does not currently own and will therefore be obligated to purchase such securities at a future date. The Company has recorded these obligations in Financial instruments sold, but not yet purchased, at fair value on the Consolidated Statement of Financial Condition. The Company will incur losses if the value of these securities increases subsequent to October 31, 2025.

The Company also pledges customers’ securities as collateral for bank loans, securities loaned, or to satisfy margin deposit requirements of various clearinghouses and exchanges. In the event the Company’s counterparty is unable to return the securities pledged, the Company might need to acquire the securities at prevailing market prices. In the case of repurchase agreements, the Company risks holding collateral at a market value less than contract value of the repurchase agreement. To control these risks, on a daily basis the Company monitors the market value of securities pledged and requires adjustments of collateral levels when deemed necessary.

Margin lending facilities
The Company provides customers with certain margin lending facilities in which it commits a loan amount collateralized by securities under a margin lending agreement. The Company does not hold collateral to support undrawn commitments under these facilities; however before funding, the Company ensures that it holds sufficient collateral for the funded amount. On an ongoing basis as part of the overall margin lending process, the Company monitors the market value of the collateral, and may require additional collateral as appropriate. As at October 31, 2025, the total undrawn commitments under these facilities totaled $48.0 million.

Leases
The Company leases office space and equipment under various non-cancellable operating leases. Most leases contain renewal options for generally five-year periods. The Company has not included any renewal options in determining the lease term and have excluded the associated potential option payments from lease payments, because the Company is not reasonably certain if it will exercise the renewal options. The Company does not have any leases which contain residual value guarantees, restrictions or covenants imposed by lessors. For leases with a term of twelve months or less, the Company does not record a lease liability or ROU assets on its Consolidated Statement of Financial Condition.

Payments due under the lease contracts can include fixed payments plus variable payments. Variable payments in office space leases generally cover real estate taxes, insurance and other occupancy expenses. The Company subleases some office space to lessees.

As at October 31, 2025, the weighted average remaining lease term for the Company’s operating leases was 6.57 years, and the weighted average discount rate for operating leases was 3.07%.

As at October 31, 2025, the aggregate maturities of operating lease liabilities were as follows:
$ in thousands As at October 31, 2025
Year
2026 89,444 $
2027 110,637
2028 103,635
2029 91,064
2030 76,327
Thereafter 147,939
Total 619,046
Less imputed interest (57,308)
Total 561,738 $

71 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 27 -
Exchange and clearing memberships
The Company maintains memberships with various domestic exchanges and clearinghouses. Exchange memberships owned by the Company are carried at cost as an intangible asset in Goodwill and intangible assets, net on the Consolidated Statement of Financial Condition and assessed periodically for potential impairment in accordance with ASC 940, Financial Services — Brokers and Dealers.

Under the standard membership agreements, members are generally required to guarantee the performance of other members. Under the agreements, if a member becomes unable to satisfy its obligations to the clearinghouse, other members would be required to meet these shortfalls. To mitigate these performance risks, the exchanges and clearinghouses often require members to post collateral. The Company’s obligation under such guarantees could exceed the collateral amounts posted. The Company’s maximum potential liability under these arrangements cannot be quantified. However, the potential for the Company to be required to make payments under these arrangements is remote. Accordingly, no contingent liability was recorded for these arrangements at October 31, 2025.

As a member of the Fixed Income Clearing Corp (FICC), the Company is required to provide additional liquidity resources under a program called the Capped Contingency Liquidity Facility (CCLF). In the event of a default of a netting member of FICC, the Company would be required to enter into a resale agreement providing cash to FICC and receiving securities as collateral. Each member’s commitment amount is periodically recalculated by FICC and communicated to the member firm. At October 31, 2025, the Company’s maximum commitment was $971.4 million.

Legal and Regulatory Matters
The Company is subject to complex legal and regulatory requirements that continue to evolve. The Company is and has been subject to a variety of legal proceedings including arbitrations, class actions and other civil litigations, as well as to other regulatory examinations, reviews, investigations (both formal and informal), audits and requests for information by various governmental regulatory agencies and self-regulatory organizations in various jurisdictions. Some of these matters may involve novel legal theories and interpretations and claims for very substantial or indeterminable damages, and some could result in the imposition of substantial civil damages (including punitive damages), regulatory enforcement penalties, fines, injunctions or other relief. In its discretion the Company may choose to resolve claims, litigations, or similar matters at any time. Based on the facts currently known, except as may otherwise be noted, it is not possible at this time for us to predict the ultimate outcome of these proceedings or the timing of their resolution.

The following is a description of the Company’s significant legal proceedings.

Royal Bank of Canada Trust Company (Bahamas) Limited Proceedings On April 13, 2015, a French investigating judge notified the Company’s affiliate, Royal Bank of Canada Trust Company (Bahamas) Limited (RBC Bahamas), of the issuance of an ordonnance de renvoi referring RBC Bahamas and other unrelated persons to the French tribunal correctionnel to face the charge of complicity in estate tax fraud relating to actions taken relating to a trust for which RBC Bahamas serves as trustee. RBC Bahamas contested the charge in the French court. On January 12, 2017, the French court acquitted all parties including RBC Bahamas and on June 29, 2018, the French appellate court affirmed the acquittals. The acquittals were appealed and on January 6, 2021 the French Supreme Court issued a judgment reversing the decision of the French Court of Appeal and sent the case back to the French Court of Appeal for rehearing.

On March 5, 2024, the Court of Appeal rendered a judgment of conviction (the Conviction) against RBC Bahamas and the other parties. RBC Bahamas was ordered by the Court of Appeal to pay a fine of €5,000 in connection with the Conviction. In addition, the Court of Appeal ordered that certain of those convicted of complicity in the matter, including RBC Bahamas, are jointly liable for the allegedly unpaid inheritance taxes owing, plus penalties and interest (such aggregate amount will be determined in a separate proceeding before the tax courts, the timing of which is to be determined). RBC Bahamas believes that its actions did not violate French law, and has appealed the Conviction to the French Supreme Court. Under French law, upon the filing of an appeal by RBC Bahamas, the Conviction, as well as its effects (fine and joint liability) were stayed pending the outcome of the appeal.

In 2016, RBC was granted an exemption by the U.S. Department of Labor that allows RBC and its current and future affiliates, including the Company, to continue to qualify for the Qualified Professional Asset Manager (QPAM) exemption under the Employee Retirement Income Security Act despite any potential conviction of RBC Bahamas in the French proceeding, for a temporary one year period from the date of conviction. The Company relies on the QPAM exemption in its ability to manage pension and retirement funds. On December 11, 2023, the U.S. Department of Labor

72 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 28 -
published a technical correction to the prior one-year exemption reflecting the fact that the then-pending Court of Appeal’s decision will be rendered by an appellate court, and not the district court. As a result of the Conviction, the temporary one-year period commenced on March 5, 2024. On January 17, 2025, the U.S. Department of Labor proposed exemptive relief to allow RBC to continue to qualify for the QPAM exemption from March 5, 2025 through March 4, 2030. On February 21, 2025, the U.S. Department of Labor proposed to extend the original relief granted to RBC in 2016 until the earlier of September 4, 2025 or the effective date of a final agency action in connection with the proposed exemption published on January 17, 2025. The six month extension was granted on March 5, 2025. The U.S. Department of Labor granted the exemptive relief it proposed on January 17, 2025, with immaterial amendments, with effect from August 12, 2025 through March 4, 2030. RBC anticipates seeking further exemptive relief from the U.S. Department of Labor prior to the expiration of the existing relief in the future to the extent deemed necessary or advisable. No assurances can be provided that such relief, if requested, would be forthcoming.

U.K. government bonds litigation
In June 2023, RBC Europe Limited and the Company, among other financial institutions, were named as defendants in a putative class action filed in the U.S. by plaintiffs alleging anti-competitive conduct, between 2009 and 2013, in the U.K. government bonds market. In September 2023, the defendants filed a motion to dismiss the complaint which motion was granted, without prejudice, in September 2024. Subsequently, on October 31, 2024, RBC Europe Limited, the Company and certain of the other defendants executed an agreement to dismiss the action, with prejudice, against those defendants. The settlement was modified by agreement of the parties in January 2025 and, on March 17, 2025, the court preliminarily approved the settlement agreement. The settlement agreement, which entails dismissal of the case as to the settling defendants for an immaterial amount, remains subject to final court approval.

Other matters
The Company is a defendant in a number of other actions alleging that certain of the Company’s practices and actions were improper. The lawsuits involve a variety of complex issues and the timing of their resolution is varied and uncertain. Management believes that the Company will ultimately be successful in resolving these lawsuits, to the extent that management is able to assess them, without material financial impact to the Company. This is, however, an area of significant judgment and the potential liability resulting from these lawsuits could be material to our results of operations in any particular period.

Various other legal proceedings are pending that challenge whether certain of the Company’s practices and actions were improper. While this is an area of significant judgment and some matters are currently inestimable, management considers that the aggregate liability, to the extent it can be assessed, resulting from these other proceedings will not be material to the Company’s Consolidated Statement of Financial Condition.

The Company contests liability and/or the amount of damages as appropriate in each pending matter. This is a matter of significant judgment and uncertainty. In view of the inherent difficulty of predicting the outcome of such matters, particularly in cases where claimants seek substantial or indeterminate damages or where investigations and proceedings are in the early stages, the Company cannot predict the loss or range of loss, if any, related to certain matters; how or if such matters will be resolved; when they will ultimately be resolved; or what the eventual settlement, fine, penalty or other relief, if any, might be. Subject to the foregoing, the Company believes, based on current knowledge and after consultation with counsel, that the outcome of such pending matters will not have a material adverse effect on the Consolidated Statement of Financial Condition of the Company.

Legal accruals have been established in accordance with the requirements for accounting for contingencies. Once established, accruals are adjusted when there is more information available or when an event occurs requiring a change.

There is a reasonable possibility that an additional loss may be incurred beyond the amount of legal accruals depending on the ultimate outcome of legal actions for which the Company is involved. Based on the facts currently known, it is not possible at this time to estimate said additional loss.

Note 17. Credit quality and market risk
The Company’s clearance activities involve the execution, settlement and financing of customers’ securities and futures transactions. Customers’ securities activities are transacted on either a cash or margin basis, while customers’ futures transactions are generally transacted on a margin basis subject to exchange regulations.

73 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 29 -
In connection with the customer clearance activities, the Company executes and clears customer transactions involving the sales of securities short (short sales), entering into futures transactions and the writing of option contracts. Short sales require the Company to borrow securities to settle customer short sale transactions and, as such, these transactions may expose the Company to loss if customers are unable to fulfill their contractual obligations and customers’ collateral balances are insufficient to fully cover their losses. In the event customers fail to satisfy their obligations, the Company may be required to purchase financial instruments at prevailing market prices in order to fulfill the customers’ obligations.

The Company seeks to control the risks associated with its customers’ activities by requiring customers to maintain margin collateral in compliance with various regulatory and internal guidelines. The Company monitors required margin levels and, pursuant to such guidelines, may require customers to deposit additional cash or collateral, or to reduce positions, when deemed necessary. The Company also establishes credit limits for customers engaged in futures activities and monitors credit compliance. Additionally, with respect to the Company’s correspondent clearing activities, introducing correspondent firms generally guarantee the contractual obligations of their customers. Further, the Company seeks to reduce credit risk by entering into netting agreements with customers, which permit receivables and payables with such customers to be offset in the event of a customer default.

In connection with the Company’s customer financing and securities settlement activities, the Company may pledge customers’ securities as collateral to satisfy the Company’s exchange margin deposit requirements or to support its various secured financing sources such as bank loans, securities loaned and repurchase agreements. In the event counterparties are unable to meet their contractual obligations to return customers’ securities pledged as collateral, the Company may be exposed to the risk of acquiring the securities at prevailing market prices to satisfy its obligations to such customers. The Company seeks to control this risk by monitoring the market value of securities pledged and by requiring adjustments of collateral levels in the event of excess exposure. Moreover, the Company establishes credit limits for such activities and monitors credit compliance.

Note 18. Income taxes
The Company is primarily taxed as a corporation for U.S. federal income tax purposes and is subject to U.S. federal and various state and local income taxes on its earnings. Income taxes include current tax and deferred tax. The Company is a part of Holdco’s U.S. federal consolidated income tax group and files its U.S., state, and local returns with Holdco.

The provision for income taxes is calculated as if the Company filed on a separate return basis. The current tax expense or benefit is either remitted to or received from Holdco. The Company is also liable for Canadian federal and provincial taxes on income of its Canadian branch income.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) became law, implementing several policy and tax-related changes. Based on our analysis, none of the applicable provisions are expected to materially impact the Company.

Income taxes are provided for using the asset and liability method under which deferred tax assets and liabilities are recognized for temporary differences between the financial reporting and tax basis of assets and liabilities.

Deferred income taxes
Deferred tax assets and liabilities are presented net as a component of Other assets on the Consolidated Statement of Financial Condition to the extent that management assesses the utilization of such temporary differences to be more likely than not. Valuation allowances are established to reduce deferred tax assets to the amount that more likely than not will be realized. As of October 31, 2025, the total valuation allowance recognized for deferred tax assets is $3.6 million, presented within Other assets on the Consolidated Statement of Financial Condition. The valuation allowance relates to foreign tax credit carryforwards. Refer to Note 3 for more information on deferred taxes.

74 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 30 -
The table below presents the components of deferred tax assets and liabilities. $ in thousands As at October 31, 2025
Deferred tax assets
Compensation and benefits $ 896,160
Unrealized losses 14,099
Allowance for loan losses 4,006
Other - DTA 24,038
Total deferred tax assets 938,303
Deferred tax liabilities
Depreciation and amortization 77,544
Other 685
Total deferred tax liabilities 78,229
Total net deferred tax assets $ 860,074
Unrecognized tax benefits
The Company recognizes tax positions in the Consolidated Statement of Financial Condition when it is more likely than not that the position will be sustained on examination by the relevant taxing authorities. If a tax position which was previously recognized on the Consolidated Statement of Financial Condition is no longer more likely than not to be sustained upon a challenge from the taxing authorities, the tax benefit from the tax position will be derecognized. As at October 31, 2025, the total tax liability associated with unrecognized tax benefits was $2.4 million.

As at October 31, 2025, the accrued liability for interest and penalties related to income tax matters was $0.1 million, and presented within Accounts payable and accrued liabilities within the Consolidated Statement of Financial Condition.

The Company does not expect a material change in the total amount of unrecognized tax benefits within the next twelve months.

Regulatory tax examinations
The Company has open tax years subject to examination for federal and state tax filings. In Canada, the earliest tax year subject to examination is 2021 and in the United States, the earliest tax year subject to examination is 2021.

Note 19. Regulatory requirements
Net capital
The Company is subject to the SEC Uniform Net Capital Rule (Rule 15c3-1), which requires the maintenance of minimum net capital. The Company has elected to use the alternative method, permitted by the rule, which requires the Company to maintain minimum net capital, as defined, equal to the greater of $1.5 million or 2% of aggregate debit items arising from customer transactions, as defined.

The Company is also subject to the CFTC’s minimum financial requirements (Regulation 1.17) which require the Company to maintain minimum net capital, as defined, equal to 8% of the total risk margin requirement for positions carried in customer accounts and 8% of the total risk margin requirement for positions carried in noncustomer accounts, as defined.

In addition, FINRA may require a member firm to reduce or not expand its business if certain net capital thresholds are not met. At October 31, 2025, the Company had net capital of $1.6 billion, which was $0.9 billion in excess of the required minimum net capital.

To allow an affiliate to classify its assets held by the Company as allowable assets in their computation of net capital, the Company computes a separate reserve requirement for Proprietary Accounts of Broker-Dealers (PAB).

75 RBC CAPITAL MARKETS, LLC & SUBSIDIARIES
Notes to the Consolidated Statement of Financial Condition - 31 -
Customer protection
Pursuant to SEC Rule 15c3-3 of the Securities Exchange Act of 1934, the Company may be required to maintain cash or qualified securities in a special reserve account for the exclusive benefit of customers and PAB. At October 31, 2025, the Company held the following cash for the benefit of customers and PAB securities accounts:
$ in thousands Customers PAB
Cash(1) $ 159,417 199,195 $
Securities value(2) - 19,774
Total reserve deposits 218,969 $ 159,417 $
(1)Reported in Cash segregated for regulatory purposes on the Consolidated Statement of Financial Condition.

As at October 31, 2025
(2)Securities represent collateral received from resale agreements, which are reported in Securities purchased under agreements to resell, at fair value on the Consolidated Statement of Financial Condition.

Pursuant to CFTC requirements, the Company is also required to segregate funds for the benefit of FCM customers. At October 31, 2025, the following funds were segregated for the various CFTC requirements:
$ in thousands
Cash(1) $ 5,367,615
Securities representing investment of customer funds(2) 579,070 Customers' securities, options, and forward value(3) 4,045,743 Total reserve deposits $ 9,992,428
As at October 31, 2025
(1)Reported in Cash segregated for regulatory purposes on the Consolidated Statement of Financial Condition. (3)Customers' securities, options, and London Metals Exchange (LME) forward value represent client positions that are not included within the Company's Consolidated Statement of Financial Condition. (2)Securities are carried at fair value and reported in Financial instruments owned, at fair value on the Consolidated Statement of Financial Condition.

Note 20. Subsequent events
The Company has evaluated events and transactions that occurred subsequent to October 31, 2025 through December 12, 2025, the date this Consolidated Statement of Financial Condition was issued. There were no events or transactions during the period which would require recognition or disclosure.

76 Attachment C
Wiring and Delivery Instructions

77 Delivery Instructions (DVP/RVP)
HIGGINS CAPITAL MANAGEMENT, INC. (HCM)
2223 Avenida de la Playa
Suite 210
La Jolla, CA 92037
TAX ID 33-0714255
TRACE REPORTING MPID: HIGG
HCM CLEARS THROUGH RBC CLEARING & CUSTODY:
#235
#235
#00235
41-1416330

RBC CAPITAL MARKETS, LLC
Three World Financial Center
200 Vessey Street, 5th Floor
NY, NY 10281
Attn: Receive and Deliver

US BANK
ABA# 091000022
Account # 160230097208
Account: RBC Capital Markets LLC
FFC: “Name & 8-digit RBC Account Number”

BANK OF NEW YORK
ABA# 021000018
Cust# BK OF NYC/DSP
#9611
#16829
DTC

ELIGIBLE STOCK/BONDS
NSCC

NON-DTC ELIGIBLE

AGENT & INSTITUTIONAL
TAX ID

PHYSICAL OTW

FED WIRE INSTRUCTIONS
(for cash)

FED INSTRUCTIONS
(for securities)
FICC

EUROCLEAR BONDS
EUROCLEAR EQUITIES #93999

78 Attachment D
Sample Research
and Newsletters

79 Eliza Winger
Team: Economics
BE Economist
Analysis
Inflation NEW
Table of Contents
US Inflation Chart Book

1. Hot Readings on US Inflation Are Ahead
(Bloomberg Intelligence) -- February PCE - due April 9 - is likely to come in hot, while March CPI could approach 1% month over month. Energy remains a key driver, but price pressures are increasingly broad-based. The oil futures curve continues to shift higher, and markets are rapidly abandoning expectations for Fed cuts this year. We expect headline inflation to peak by May, and the Fed to cut rates later this year.

In this edition of the US Inflation Chart Book we explore the major drivers, underlying trends, and implications. Where is inflation headed this year? Scroll below for a detailed analysis. (03/20/26) Analysis
Inflation

2. Another Hot US PPI Shows Pressure Across the Value Chain Producer price pressures increased in February throughout the value chain, in another hot PPI print. Transportation and warehousing costs continued higher, as did manufacturing components - notably metals - exerting continued upward pressure on goods prices in coming months. Finaldemand services also rose, though growth in trade margins slowed after two straight outsized gains.

PPI components that feed into the Fed’s preferred inflation gauge - the core PCE deflator - will add less than they did in January, with gains in portfolio-management fees offset by weaker health-care costs and declines in airfares. Click the Text tab for more. (03/20/26) Metals Prices Rose Further in February
Source: BLS, Bloomberg Economics

3. FOMC Members Upgrade Projections for US Inflation
The FOMC revised inflation projections sharply higher for this year. Participants now expect PCE inflation of 2.7% (up from 2.4% in the December SEP) and core PCE inflation of 2.7% (up from

2.5% previously). Projections for 2027 and 2028 were revised up slightly to 2.2% (from 2.1% prior).

This document is being provided for the exclusive use of DEBBIE HIGGINS at HIGGINS CAPITAL MANAGEMENT INC. Not for redistribution.

This report may not be modified or altered in any way. The BLOOMBERG PROFESSIONAL service and BLOOMBERG Data are owned and distributed locally by Bloomberg Finance LP ("BFLP") and its subsidiaries in all jurisdictions other than Argentina, Bermuda, China, India, Japan and Korea (the ("BFLP Countries"). BFLP is a wholly-owned subsidiary of Bloomberg LP ("BLP"). BLP provides BFLP with all the global marketing and operational support and service for the Services and distributes the Services either directly or through a non-BFLP subsidiary in the BLP Countries. BFLP, BLP and their affiliates do not provide investment advice, and nothing herein shall constitute an offer of financial instruments by BFLP, BLP or their affiliates.

Bloomberg® 03/25/2026 16:10:24

80 Chair Powell said during his press conference that these projections are “certainly” tied to the Middle East and oil - the spillover from gasoline to core inflation - and partly due to perceived slow progress on disinflation because of tariffs. (03/20/26) Distribution of PCE Inflation Outlook Shifts Higher
Source:  Federal Reserve

4. US Inflation Expectations to Edge Higher in the Short-Run The preliminary reading of U-Mich consumer sentiment for March showed consumers were already expecting at least a short-term shock to gasoline prices, and we think those concerns likely intensified as the month went on. As a result, year-ahead inflation expectations will move higher, although we don't anticipate a meaningful change in long-run inflation views.

Click the Text tab for more. (03/20/26)
Short-Run Inflation Expectations vs. Gasoline Prices
Source: Department of Energy, University of Michigan

5. US Core PCE Measures Were Rising Before Iran War
The core PCE deflator - the Fed's preferred inflation measure - was unchanged at 0.36% in January. On a year-over-year basis, core PCE inflation increased to 3.1%, from 3.0% in December.

On one-, three- and six-month annualized bases, January core PCE rose to 4.5% (vs. 4.4% prior),

3.7% (vs. 3.1% prior) and 3.1% (vs. 2.9% prior), respectively.

Other core inflation measures increased in January, illustrating that services drove the core PCE reading. Supercore PCE inflation - core services excluding housing - grew 0.43%, up from 0.34% in December, with healthcare leading the gains. Market-based core PCE inflation - which excludes imputed prices or prices not directly observed - remained hot at 0.38%, from 0.35% prior. Click the Text tab for more. (03/20/26)
This document is being provided for the exclusive use of DEBBIE HIGGINS at HIGGINS CAPITAL MANAGEMENT INC. Not for redistribution.

This report may not be modified or altered in any way. The BLOOMBERG PROFESSIONAL service and BLOOMBERG Data are owned and distributed locally by Bloomberg Finance LP ("BFLP") and its subsidiaries in all jurisdictions other than Argentina, Bermuda, China, India, Japan and Korea (the ("BFLP Countries"). BFLP is a wholly-owned subsidiary of Bloomberg LP ("BLP"). BLP provides BFLP with all the global marketing and operational support and service for the Services and distributes the Services either directly or through a non-BFLP subsidiary in the BLP Countries. BFLP, BLP and their affiliates do not provide investment advice, and nothing herein shall constitute an offer of financial instruments by BFLP, BLP or their affiliates.

Bloomberg® 03/25/2026 16:10:24

81 Core PCE Measures Are Rising
Source: BEA

6. US CPI Flags New Supply Shocks Before Iran Oil Spike Our analysis suggests two new supply shocks were building even before the Middle East War - a metal-price shock that started in December, and a global shortage of memory chips. Both were beginning to pass through to consumer prices, according to a Bloomberg Economics' CPI tracker employing big data.

Click the Text tab for more. (03/20/26)
CPI Line Items Affected by Metals and Memory Chips
Shock
Source: Bloomberg Economics

7. US CPI Is Uneven Regionally
Inflation across the South and in New England has fallen below pre-pandemic rates, while states on the West Coast and Middle Atlantic areas are facing annual price increases of 3% or more.

Among metro areas the Bureau of Labor Statistics tracked in February, inflation was highest in Seattle-Tacoma-Bellevue, Washington, up 3.9% from a year earlier. In California, inflation was elevated in Los Angeles-Long Beach-Anaheim (2.9%) and San Francisco-Oakland-Hayward (2.5%) metro areas - higher than the 2.4% national average.

Click the Text tab for more. (03/20/26)
This document is being provided for the exclusive use of DEBBIE HIGGINS at HIGGINS CAPITAL MANAGEMENT INC. Not for redistribution.

This report may not be modified or altered in any way. The BLOOMBERG PROFESSIONAL service and BLOOMBERG Data are owned and distributed locally by Bloomberg Finance LP ("BFLP") and its subsidiaries in all jurisdictions other than Argentina, Bermuda, China, India, Japan and Korea (the ("BFLP Countries"). BFLP is a wholly-owned subsidiary of Bloomberg LP ("BLP"). BLP provides BFLP with all the global marketing and operational support and service for the Services and distributes the Services either directly or through a non-BFLP subsidiary in the BLP Countries. BFLP, BLP and their affiliates do not provide investment advice, and nothing herein shall constitute an offer of financial instruments by BFLP, BLP or their affiliates.

Bloomberg® 03/25/2026 16:10:24

82 US Inflation Map
Source: BLS
To contact the analyst for this research:

Eliza Winger at [email protected]
This document is being provided for the exclusive use of DEBBIE HIGGINS at HIGGINS CAPITAL MANAGEMENT INC. Not for redistribution.

This report may not be modified or altered in any way. The BLOOMBERG PROFESSIONAL service and BLOOMBERG Data are owned and distributed locally by Bloomberg Finance LP ("BFLP") and its subsidiaries in all jurisdictions other than Argentina, Bermuda, China, India, Japan and Korea (the ("BFLP Countries"). BFLP is a wholly-owned subsidiary of Bloomberg LP ("BLP"). BLP provides BFLP with all the global marketing and operational support and service for the Services and distributes the Services either directly or through a non-BFLP subsidiary in the BLP Countries. BFLP, BLP and their affiliates do not provide investment advice, and nothing herein shall constitute an offer of financial instruments by BFLP, BLP or their affiliates.

Bloomberg® 03/25/2026 16:10:24

83 Ira F Jersey
Team: Strategy
BI Rates Strategist
Will Hoffman
Team: Strategy
BI Rates Strategist
Iran War Shifts Treasury-Market Outlook
Treasury Yield-Curve Normalization Means Flattening Nearing End (Bloomberg Intelligence) -- Treasury yield-curve-flattening may be nearing an end, as short maturities are starting to price enough term premium for realistic near-term Federal Reserve policy-rate outcomes. We think eventually the pricing for near-term interest-rate increases will fade. Though not our base scenario, it's possible the next Fed action may be a hike.

Visit BI RATEN <GO> for research and key data. To subscribe, click the button above. (03/23/26)

1. Central Banks May React to Oil Rise Differently
When there are major shocks and uncertainty increases, investors tend to exit long-end trades and opinions. The current energy-price shock generated by the US-Israel war with Iran increases uncertainty, yet also puts central banks on alert. Though the Fed's mandate is for stable prices and full employment, most other central banks focus only on inflation, so the climb in energy prices can't be ignored. Have we turned the page on easing actions by central banks, flipping toward multiple hikes to quell inflation?
It's quite possible the European Central Bank and Bank of England hike rates to quell inflation, which generally causes demand destruction and can push some economies very close to or into recession. We think the Fed will react somewhat differently, more likely maintaining its current policy stance. (03/23/26)
Implied 1y1y Forward Yields & Policy Rates

2. Fed's Path of Least Resistance Is to Hold
Global monetary-policy regimes often coincide, but not always, and we suspect the US might diverge from the ECB, BOE, and BOJ if the latter raise rates to combat energy-led inflation. The Fed has the luxury of its dual mandate, and could keep rates steady even if oil pushes core inflation measures slightly higher. Meanwhile, it seems there could be demand destruction and the potential for job losses elsewhere. Though there remain some relatively dovish members of the FOMC, the March 2026 meeting dot plot clearly shows most members see unchanged or only one 25-bp rate cut this year. We think most who see a single cut will vote to hold rates unless the labor market deteriorates further.

This document is being provided for the exclusive use of DEBBIE HIGGINS at HIGGINS CAPITAL MANAGEMENT INC. Not for redistribution.

This report may not be modified or altered in any way. The BLOOMBERG PROFESSIONAL service and BLOOMBERG Data are owned and distributed locally by Bloomberg Finance LP ("BFLP") and its subsidiaries in all jurisdictions other than Argentina, Bermuda, China, India, Japan and Korea (the ("BFLP Countries"). BFLP is a wholly-owned subsidiary of Bloomberg LP ("BLP"). BLP provides BFLP with all the global marketing and operational support and service for the Services and distributes the Services either directly or through a non-BFLP subsidiary in the BLP Countries. BFLP, BLP and their affiliates do not provide investment advice, and nothing herein shall constitute an offer of financial instruments by BFLP, BLP or their affiliates.

Bloomberg® 03/25/2026 16:12:33

84 Such divergence has both yield curve and FX implications. We'll leave it to our FX Strategy team to opine on the dollar. (03/23/26)
Fed Dot Plot From Summary of Economic Projections

3. Oil Inflation Driving Front-End Yield Selloff
Since last Thursday's Bank of England meeting, the front end of the TIPS yield curve has sold off dramatically (about 14-bps for 2-year), yet this has only unwound the strong rally since late February prior to the start of the Iran war. Over that period, two-year inflation breakevens have climbed over 50 bps, being the largest driver of the front-end nominal yield selloff. The inflation dynamic has driven the nominal 2-year/10-year yield-curve flattening over this period. We think there's a limit to how flat the yield curve is likely to get, as persistent risks to the economy may limit the front-end selloff.

The real-yield move is largely due to the market pricing out rate cuts for this year. The path to cuts has become murkier, but not impossible to take, depending when the war ends and its lasting effect on jobs. (03/23/26)
Short-End Yield Moves Driven by Breakevens

4. Yield-Curve Flattening Close to Running Course
Since the start of the Iran war, the belly of the yield curve has underperformed, and the nominal Treasury curve now looks rather normal, without any major kinks suggesting cuts, and only modest rate hikes. The modestly upward-sloping curve represents market pricing for some term premium in an environment where there's no clear expectation of which direction the next Fed policy-rate move will be.

We don't think it's realistic that the Fed hikes this year, and suspect any such pricing will be quickly unwound. Until there's clarity about the Iran war, we don't see the market pricing for aggressive rate cuts unless the job market turns sharply negative. Technically, the next major This document is being provided for the exclusive use of DEBBIE HIGGINS at HIGGINS CAPITAL MANAGEMENT INC. Not for redistribution.

This report may not be modified or altered in any way. The BLOOMBERG PROFESSIONAL service and BLOOMBERG Data are owned and distributed locally by Bloomberg Finance LP ("BFLP") and its subsidiaries in all jurisdictions other than Argentina, Bermuda, China, India, Japan and Korea (the ("BFLP Countries"). BFLP is a wholly-owned subsidiary of Bloomberg LP ("BLP"). BLP provides BFLP with all the global marketing and operational support and service for the Services and distributes the Services either directly or through a non-BFLP subsidiary in the BLP Countries. BFLP, BLP and their affiliates do not provide investment advice, and nothing herein shall constitute an offer of financial instruments by BFLP, BLP or their affiliates.

Bloomberg® 03/25/2026 16:12:33

85 10-year yield resistance is about 4.50%, which we think will hold for now, while the 2-year will find the 4% level difficult to breach. (03/23/26)
Treasury Yield Curve
To contact the analyst for this research:

Ira F Jersey at [email protected]
This document is being provided for the exclusive use of DEBBIE HIGGINS at HIGGINS CAPITAL MANAGEMENT INC. Not for redistribution.

This report may not be modified or altered in any way. The BLOOMBERG PROFESSIONAL service and BLOOMBERG Data are owned and distributed locally by Bloomberg Finance LP ("BFLP") and its subsidiaries in all jurisdictions other than Argentina, Bermuda, China, India, Japan and Korea (the ("BFLP Countries"). BFLP is a wholly-owned subsidiary of Bloomberg LP ("BLP"). BLP provides BFLP with all the global marketing and operational support and service for the Services and distributes the Services either directly or through a non-BFLP subsidiary in the BLP Countries. BFLP, BLP and their affiliates do not provide investment advice, and nothing herein shall constitute an offer of financial instruments by BFLP, BLP or their affiliates.

Bloomberg® 03/25/2026 16:12:33

86

87

88

89

90

91

92 From: Deborah Higgins
To: Deborah Higgins
Subject: Higgins Capital In Touch With...

Date: Wednesday, March 25, 2026 7:36:16 AM
Attachments: image001.png

SECONDARY AGENCY & CORPORATE BULLETS/CALLABLES

TREAT SUBJECT
as of 3/25/2026 7:35 AM
Below are runs of combined dealers’ secondary agency/corporate bullet and callable inventory that Higgins Capital is in touch with. If you don’t see the maturity you need, let me know and I’ll scan inventories for updates.

For our corporate buyers, our sort is with a minimum rating category of “A” or its equivalent. I’ll confirm specific rating details, make whole (MW) or standard call features, etc.

Securities are California Code Compliant for Local Agency Governments. * Securities are sorted by Maturity in Bullets then Callables.

Deb
Call me: 800-716-6510
Text me: 858-251-1648
[email protected]
Agencies Agencies
Security Ask Size Ask Price YTM YTC CUSIP Callable
FHLB Float 04/16/26 1,950,000 99.99 3.79 3130B85J7 N
FFCB Float 04/17/26 800,000 100.00 3.68 3133ERBQ3 N
FHLB Float 08/25/26 6,900,000 100.00 3.63 3130B8Q39 N
FFCB Float 08/28/26 2,800,000 100.05 3.63 3133ERYS4 N
FHLB 1 7/8 09/11/26 1,000,000 99.17 3.72 3130A8XY4 N
FFCB Float 03/24/27 980,000 100.03 3.66 3133ETAL1 N
FAMCA Float 04/23/27 25,000,000 100.00 3.69 31428JEG8 N FFCB Float 09/07/27 551,000 100.16 3.68 3133ER6M8 N
FHLMC Float 10/06/27 700,000 100.12 3.68 3134HBU66 N
FNMA 0 3/4 10/08/27 3,000,000 95.36 3.90 3135G05Y5 N
FFCB Float 11/03/27 800,000 100.09 3.69 3133ETP76 N
FHLB 3 1/2 03/03/28 3,000,000 99.27 3.89 3130B9RC6 N
FHLB 4 1/2 03/10/28 1,400,000 101.22 3.85 3130ATS57 N
FHLB 3 1/4 11/16/28 2,500,000 98.51 3.85 3130AFFX0 N
FNMA 6 1/4 05/15/29 16,513,000 106.94 3.88 31359MEU3 N
FNMA 6 5/8 11/15/30 2,000,000 111.09 3.98 31359MGK3 N
FAMCA 1.28 02/18/31 960,000 87.94 4.02 31422XAX0 N
FHLMC 6 3/4 03/15/31 2,152,000 112.31 3.99 3134A4AA2 N
FAMCA 3.8 03/17/31 3,950,000 99.19 3.98 31428JDW4 N
FHLB 3.615 02/08/27 26,640,000 99.94 3.68 3.80 3130B93Z1 Y FHLB 3.62 02/08/27 32,000,000 99.84 3.81 4.16 3130B93X6 Y FHLB 1 3/4 12/29/27 2,750,000 96.32 3.93 3130AMZY1 Y
FFCB 3.57 02/11/28 48,300,000 99.43 3.89 4.24 3133EWCY4 Y FHLMC 4 1/8 03/10/28 18,137,000 99.94 4.16 4.42 3134HCZV4 Y FHLB 4 1/4 03/24/28 6,070,000 99.95 4.28 4.47 3130BA2V8 Y FNMA 4 1/4 03/24/28 25,000,000 100.00 4.25 4.25 3136GCWY7 Y FHLMC 3.95 02/12/29 50,000,000 99.50 4.14 7.90 3134HCSY6 Y FHLMC 3.9 02/20/29 50,000,000 99.41 4.12 7.85 3134HCWB1 Y

93 FHLMC 3.65 03/02/29 2,285,000 99.15 3.96 4.59 3134HCWP0 Y FHLMC 4 03/09/29 11,645,000 99.68 4.12 13.04 3134HCWZ8 Y FHLMC 3 3/4 03/12/29 665,000 99.10 4.08 4.72 3134HCYC7 Y FFCB 3.94 03/16/29 2,667,000 99.45 4.14 5.12 3133EWGR5 Y FNMA 3.85 03/16/29 1,405,000 99.25 4.12 5.47 3136GCQ65 Y FHLMC 4 03/23/29 763,000 99.60 4.14 4.42 3134HCB40 Y
FHLMC 4 1/4 03/23/29 49,000,000 99.78 4.33 5.19 3134HCB57 Y FNMA 4 1/2 03/23/29 7,460,000 99.97 4.51 4.65 3136GCXU4 Y FNMA 4.2 03/23/29 2,501,000 99.88 4.25 4.72 3136GCUL7 Y FNMA 3.85 03/29/29 4,250,000 99.45 4.05 4.42 3136GCVF9 Y FHLMC 3 5/8 06/27/29 3,945,000 99.00 3.95 7.59 3134HANY5 Y FHLB 4.04 03/25/30 6,365,000 99.55 4.16 4.51 3130B9VZ0 Y FNMA 4 1/4 03/25/30 3,454,000 99.75 4.32 4.76 3136GCVJ1 Y FNMA 4.35 12/12/30 19,531,000 99.71 4.42 10.86 3136GCAD7 Y FNMA 4 1/4 01/13/31 19,688,000 99.44 4.38 16.10 3136GCFK6 Y FHLMC 4 1/4 01/28/31 7,624,000 99.44 4.38 5.90 3134HCRS0 Y FNMA 4.23 02/10/31 28,075,000 99.38 4.37 5.90 3136GCLA1 Y FHLMC 4.21 02/12/31 2,000,000 99.30 4.37 9.71 3134HCUR8 Y FHLMC 4 1/4 03/03/31 50,000,000 99.50 4.36 30.08 3134HCWY1 Y FNMA 4.1 03/17/31 847,000 99.10 4.30 6.04 3136GCRC1 Y
FNMA 4 03/24/31 1,755,000 99.45 4.12 4.29 3136GCVD4 Y
FHLB 4 1/2 03/25/31 5,000,000 99.95 4.51 4.55 3130BA2S5 Y FHLB 4.4 03/25/31 4,855,000 99.73 4.46 5.53 3130B9WW6 Y Corporates Corporates Corporates
Security Ask Size Ask Price YTM YTC CUSIP Callable
PACLIF Float 03/27/26 13,043,000 100.00 4.21 6944PL3B3 N TOYOTA Float 04/10/26 1,700,000 100.01 3.83 89236TMR3 N ATH Float 05/08/26 2,550,000 100.07 3.88 04685A3W9 N
TOYOTA Float 05/15/26 5,197,000 100.03 3.86 89236TME2 N TOYOTA Float 05/18/26 1,037,000 100.09 3.95 89236TKV6 N PACLIF Float 06/04/26 1,487,000 100.08 3.84 6944PL2G3 N DE Float 06/08/26 7,250,000 100.13 3.78 24422EWY1 N
NYLIFE Float 06/09/26 3,000,000 100.06 3.82 64952WEE9 N ATH 1.608 06/29/26 10,000,000 99.34 04685A2Z3 N
MASSMU Float 07/10/26 1,000,000 100.21 3.88 57629TBQ9 N UNH 4 3/4 07/15/26 1,443,000 100.23 91324PFF4 N
ATH Float 07/16/26 1,000,000 100.09 4.08 04685A4J7 N
TOYOTA Float 08/07/26 2,100,000 100.13 4.05 89236TML6 N ROSW Float 11/13/26 1,040,000 100.29 3.91 ZH9861142 N
TOYOTA Float 12/09/26 3,267,000 100.07 3.87 89236TPD1 N JPM 4 1/8 12/15/26 2,855,000 100.08 46625HJZ4 N
MET 3.45 12/18/26 3,600,000 99.61 4.00 59217GBY4 N
DE Float 01/05/27 1,030,000 100.12 3.88 24422EYB9 N
ATH Float 01/07/27 1,208,000 100.13 4.28 04685A4F5 N
CAT 4 1/2 01/07/27 1,223,000 100.38 14913UAV2 N
TOYOTA Float 01/08/27 4,000,000 100.03 4.06 89236TMZ5 N MS 3 5/8 01/20/27 5,000,000 61746BEF9 N
PACLIF Float 02/04/27 7,000,000 100.03 4.07 6944PL3G2 N PACLIF Float 02/05/27 40,060,000 100.41 3.99 6944PL3A5 N PM 4 3/4 02/12/27 24,000,000 100.61 718172DF3 N
TOYOTA 5 03/19/27 1,000,000 101.04 89236TLY9 N
TOYOTA Float 03/19/27 1,400,000 100.25 4.03 89236TMA0 N ONCRTX 4 1/2 03/20/27 1,771,000 100.20 4.29 68233JDB7 N TOYOTA 3.05 03/22/27 23,775,000 98.98 89236TJZ9 N
DE Float 04/19/27 3,575,000 100.30 3.94 24422EXQ7 N
WMT Float 04/28/27 1,250,000 100.25 3.83 931142FM0 N
TOYOTA Float 05/14/27 1,219,000 100.35 4.02 89236TNH4 N NYLIFE Float 06/11/27 4,731,000 100.25 3.97 64953BBY3 N BALN 7 1/2 07/01/27 1,200,000 103.83 4.35 11041RAL2 N
JPM 4 1/4 10/01/27 3,189,000 100.06 4.21 46625HNJ5 N
CAT 4.4 10/15/27 4,365,000 100.43 4.11 14913UAR1 N

94 CAT Float 11/15/27 1,880,000 100.20 4.07 14913UAT7 N DE 4.65 01/07/28 2,300,000 100.85 4.15 24422EXZ7 N
CAT Float 01/10/28 7,233,000 99.95 4.05 14913UBG4 N
TOYOTA Float 01/12/28 3,427,000 99.95 4.10 89236TPG4 N
ATH Float 03/06/28 4,375,000 100.00 4.58 04685A4M0 N
PYPL Float 03/06/28 2,251,000 100.25 4.16 70450YAR4 N
AMZN 3.85 03/13/28 5,000,000 99.44 4.15 023135DB9 N
AMZN Float 03/13/28 4,450,000 100.04 4.04 023135CZ7 N
ATH 2 1/2 03/24/28 1,460,000 95.35 4.98 04685A2V2 N
PM Float 04/28/28 777,000 100.01 4.46 718172DS5 N
ATH 4.83 05/09/28 9,075,000 99.85 4.90 04685A4N8 N
HSBC Float 06/03/28 700,000 100.60 4.32 40428HS29 N
NYLIFE 4.9 06/13/28 1,570,000 101.23 4.31 64952WFD0 N
UNH 3.85 06/15/28 1,291,000 99.21 4.22 91324PDK5 N
HYNMTR 4.9 06/23/28 1,953,000 100.66 4.58 44891ADV6 N
MASSMU Float 08/01/28 1,600,000 100.13 4.25 57629TBY2 N MET Float 08/25/28 6,420,000 100.20 4.24 592179KS3 N
PROTLI Float 09/11/28 5,000,000 100.26 4.36 743672AJ6 N CAT Float 11/14/28 1,061,000 100.15 4.15 14913UBE9 N
CAT Float 02/23/29 4,031,000 99.85 4.17 14913UBK5 N
AMZN Float 03/13/29 2,520,000 100.09 4.18 023135DA1 N
TOYOTA 4.05 03/13/29 5,000,000 99.48 4.24 89236TPQ2 N
TOYOTA Float 03/13/29 2,000,000 100.06 4.26 89236TPR0 N MET 3.3 03/21/29 1,213,000 96.93 4.41 59217GEZ8 N
DE 2.8 07/18/29 1,965,000 95.66 4.22 24422EUY3 N
PROTLI 4.772 12/09/29 1,430,000 100.48 4.63 74368CCA0 N MASSMU 4.95 01/10/30 3,500,000 101.40 4.54 57629TBV8 N
PACLIF 4.85 02/10/30 9,250,000 101.12 4.53 6944PL3F4 N
WMT 7.55 02/15/30 2,031,000 112.47 4.05 931142BF9 N
HYNMTR Float 03/27/30 1,040,000 101.40 4.60 44891ADT1 N MET 2.95 04/09/30 1,275,000 94.09 4.57 59217GEG0 N
WSFIN 4.9 05/01/30 5,460,000 101.03 4.62 95954A2A0 N
PRU 4.7 05/28/30 10,000,000 100.82 4.48 74153WCW7 N
MET 4.2 09/16/30 3,271,000 98.53 4.57 58989V2L7 N
TOYOTA 5.55 11/20/30 4,319,000 104.48 4.47 89236TLE3 N
CNO 4.7 12/11/30 14,719,000 98.96 4.95 18977W2J8 N
JPM 2.95 10/01/26 7,000,000 99.40 46625HRV4 Y
MS 5.882 10/30/26 3,500,000 61690U7W4 Y
JPM 5.11 12/08/26 2,164,000 100.61 48125LRU8 Y
WFC Float 12/11/26 2,090,000 100.46 4.05 3.99 94988J6G7 Y CNP 3 02/01/27 4,000,000 99.08 15189XAR9 Y
MS Float 10/15/27 7,392,000 100.07 4.26 4.18 61690U8F0 Y JPM 6.07 10/22/27 1,519,000 100.95 4.75 4.36 46647PDW3 Y C Float 11/19/27 2,265,000 100.10 4.27 4.18 17325FBM9 Y AMZN 4.55 12/01/27 2,677,000 100.88 4.00 3.98 023135CP9 Y MS Float 01/14/28 2,610,000 100.38 4.48 4.22 61690U7Z7 Y BAC 3.824 01/20/28 2,262,000 99.51 5.06 4.44 06051GGF0 Y PNC 3 1/4 01/22/28 10,000,000 98.51 4.11 4.15 69353RFJ2 Y JPM Float 01/23/28 1,081,000 100.62 4.47 4.06 46647PDZ6 Y FITB Float 01/28/28 1,000,000 100.06 4.41 4.37 31677QBV0 Y BK 3.4 01/29/28 7,500,000 98.74 4.12 4.23 06406RAF4 Y
IBM 4.65 02/10/28 16,395,000 100.73 4.24 4.22 459200LF6 Y CPT 4.1 10/15/28 4,200,000 99.82 4.17 4.18 133131AW2 Y
JPM Float 10/22/28 1,123,000 100.40 4.33 4.23 46647PEN2 Y BPLN 4.234 11/06/28 10,000,000 100.04 4.21 4.22 10373QAE0 Y MS Float 11/17/28 5,000,000 100.03 4.39 4.38 61776NZT3 Y HYNMTR 5.3 01/08/29 5,013,000 101.77 4.61 4.60 44891ACU9 Y MS Float 01/12/29 5,271,000 100.30 4.42 4.36 61690DK64 Y UNH 4 1/4 01/15/29 1,466,000 99.90 4.29 4.29 91324PEU2 Y BAC 4.979 01/24/29 10,000,000 100.88 4.47 4.47 06051GMK2 Y MS 3.772 01/24/29 10,000,000 98.75 4.71 4.49 61744YAP3 Y PNC 4.075 01/26/29 10,000,000 99.52 4.32 4.35 693475CG8 Y PNC Float 01/26/29 3,159,000 100.00 4.25 4.25 693475CH6 Y

95 TFC Float 01/27/29 3,824,000 100.04 4.27 4.26 89788JAK5 Y MS 5.123 02/01/29 10,000,000 101.11 4.79 4.49 61747YFA8 Y MS 4.133 10/18/29 3,401,000 98.91 4.58 4.59 61748UAK8 Y MS Float 10/18/29 6,064,000 100.23 4.47 4.45 61748UAJ1 Y MS 6.407 11/01/29 10,000,000 104.37 4.83 4.60 61747YFH3 Y RDSALN 2 3/8 11/07/29 8,140,000 93.72 4.27 4.40 822905AF2 Y AMZN 4.65 12/01/29 3,779,000 101.56 4.19 4.17 023135CQ7 Y JPM 4.452 12/05/29 10,000,000 100.00 4.68 4.45 46647PAX4 Y MS 4.238 01/09/30 1,059,000 98.98 4.59 4.63 61748UAR3 Y MS Float 01/09/30 5,000,000 99.77 4.48 4.50 61748UAQ5 Y UNH 4.8 01/15/30 2,036,000 101.29 4.43 4.42 91324PFG2 Y MS 5.173 01/16/30 10,000,000 101.41 4.75 4.63 61747YFK6 Y BK 4.026 01/22/30 10,000,000 98.88 4.39 4.45 06406RCG0 Y BK Float 01/22/30 1,045,000 100.05 4.25 4.30 06406RCK1 Y JPM 5.012 01/23/30 10,000,000 101.44 4.58 4.46 46647PEB8 Y MS 4.431 01/23/30 7,914,000 99.59 4.84 4.59 6174468G7 Y AVGO 4.2 10/15/30 5,000,000 98.97 4.45 4.46 11135FCW9 Y JPM 2.739 10/15/30 5,226,000 94.23 4.67 4.52 46647PBE5 Y WEC 4.15 10/15/30 1,046,000 98.94 4.41 4.42 976656CU0 Y MS 4.654 10/18/30 10,000,000 99.98 4.68 4.66 61747YFU4 Y BAC 2.884 10/22/30 10,000,000 94.59 4.68 4.54 06051GHX0 Y JPM 4.603 10/22/30 10,000,000 100.27 4.56 4.52 46647PEQ5 Y AVGO 4.15 11/15/30 5,000,000 98.75 4.45 4.47 11135FAQ4 Y AVGO 4.3 01/15/31 5,000,000 99.35 4.45 4.45 11135FCZ2 Y EPD 4.6 01/15/31 1,716,000 100.38 4.51 4.51 29379VCK7 Y MS 5.23 01/15/31 10,000,000 101.77 4.72 4.71 61748UAE2 Y MS 2.699 01/22/31 10,000,000 93.02 4.73 4.71 6174468L6 Y BAC 5.162 01/24/31 10,000,000 102.21 4.55 4.52 06051GML0 Y JPM 5.14 01/24/31 10,000,000 102.01 4.58 4.56 46647PEV4 Y BK 4.942 02/11/31 3,073,000 101.73 4.47 4.45 06406RCB1 Y TMO 4.215 02/12/31 3,944,000 99.02 4.44 4.44 883556DG4 Y USB 5.046 02/12/31 5,000,000 101.51 4.63 4.61 91159HJT8 Y BAC 2.496 02/13/31 10,000,000 92.65 4.66 4.58 06051GHZ5 Y

INTENDED FOR INSTUTITIONAL INVESTORS ONLY
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96 Attachment E
Proof of FINRA Certification

97 6762
BrokerCheck Report
HIGGINS CAPITAL MANAGEMENT, INC.

CRD# 39985
Section Title Page(s)
Report Summary 1
Firm Profile 2-4
Firm History 5
Firm Operations 6 - 11
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Make sure you know who you're dealing with when investing, and contact FINRA with any concerns.

For more information read our investor alert on imposters. 67 8

98 About BrokerCheck®
BrokerCheck offers information on all current, and many former, registered securities brokers, and all current and former registered securities firms. FINRA strongly encourages investors to use BrokerCheck to check the background of securities brokers and brokerage firms before deciding to conduct, or continue to conduct, business with them. • What is included in a BrokerCheck report?
• BrokerCheck reports for individual brokers include information such as employment history, professional qualifications, disciplinary actions, criminal convictions, civil judgments and arbitration awards. BrokerCheck reports for brokerage firms include information on a firm's profile, history, and operations, as well as many of the same disclosure events mentioned above.
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o information FINRA and/or the Securities and Exchange Commission (SEC) require brokers and brokerage firms to submit as part of the registration and licensing process, and o information that regulators report regarding disciplinary actions or allegations against firms or brokers. • How current is this information?
• Generally, active brokerage firms and brokers are required to update their professional and disciplinary information in CRD within 30 days. Under most circumstances, information reported by brokerage firms, brokers and regulators is available in BrokerCheck the next business day. • What if I want to check the background of an investment adviser firm or investment adviser representative?
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the contents of this report, please
refer to the User Guidance or
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provides a glossary of terms and a
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•
Thank you for using FINRA BrokerCheck.

99 www.flnra.ora/brokercheck

HIGGINS CAPITAL MANAGEMENT,
INC.

Report Summary for this Firm
User Guidance
Fin�
CRD# 39985
SEC# 8-48921
Main Office Location
This report summary provides an overview of the brokerage firm. Additional information for this firm can be found in the detailed report.

Firm Profile Disclosure Events
This firm is classified as a corporation.
2223 AVENIDA DE LA PLAYA STE. 210
LA JOLLA, CA 92037-3218
Regulated by FINRA Los Angeles Office
Mailing Address
2223 AVENIDA DE LA PLAYA STE. 210
LA JOLLA, CA 92037-3218
Business Telephone Number
800-716-6510
This firm is a brokerage firm and an investment
adviser firm. For more information about
investment adviser firms, visit the SEC's
Investment Adviser Public Disclosure website at:
https://www.adviserinfo.sec.gov
This firm was formed in California on 05/06/1995.

Its fiscal year ends in December.

Firm History
Information relating to the brokerage firm's history
such as other business names and successions
(e.g., mergers, acquisitions) can be found in the
detailed report.

Firm Operations
This firm is registered with:
• the SEC
• 1 Self-Regulatory Organization • 3 U.S. states and territories Is this brokerage firm currently suspended with any
regulator? No
This firm conducts 7 types of businesses.

This firm is not affiliated with any financial or
investment institutions.

This firm has referral or financial arrangements with
other brokers or dealers.

Brokerage firms are required to disclose certain
criminal matters, regulatory actions, civil judicial
proceedings and financial matters in which the firm or
one of its control affiliates has been involved.

Are there events disclosed about this firm? No

100
www.finra.ora/brokcrcheck
Firm Profile
This firm is classified as a corporation.

This firm was formed in California on 05/06/1995.

Its fiscal year ends in December.

Firm Names and Locations
This section provides the brokerage firm's full legal name, "Doing Business As" name, business and mailing addresses, telephone number, and any alternate name by which the firm conducts business and where such name is used.

HIGGINS CAPITAL MANAGEMENT, INC.

Doing business as HIGGINS CAPITAL MANAGEMENT, INC.

CRD# 39985
SEC# 8-48921
Main Office Location
2223 AVENIDA DE LA PLAYA STE. 210
LA JOLLA, CA 92037-3218
Regulated by FINRA Los Angeles Office
Mailing Address
2223 AVENIDA DE LA PLAYA STE. 210
LA JOLLA, CA 92037-3218
Business Telephone Number
800-716-6510
©2024 FINRA. All rights reserved. Report about HIGGINS CAPITAL MANAGEMENT, INC.

User Guidance
Fin�
2

101
www.finra.oro/brokcrcheck
Firm Profile
This section provides information relating to all direct owners and executive officers of the brokerage firm.

Direct Owners and Executive Officers
User Guidance
Legal Name & CRD# (if any):

Is this a domestic or foreign
entity or an individual?
Position
Position Start Date
Percentage of Ownership
Does this owner direct the
management or policies of
the firm?
Is this a public reporting
company?
Legal Name & CRD# (If any):

Is this a domestic or foreign
entity or an Individual?
Position
Position Start Date
Percentage of Ownership
Does this owner direct the
management or policies of
the firm?
Is this a public reporting
company?

HIGGINS, DEBORAH MUTISPAUGH
1220543
Individual

PRESIDENT/CCO
06/1996
50% but less than 75%
Yes
No

HIGGINS, RAYMOND LEE
1250444
Individual

CEO/CFO/FINOPS
06/1996
25% but less than 50%
Yes
No

102
www.finra.orci/brokcrchcck
Firm Profile
This section provides information relating to any indirect owners of the brokerage firm.

Indirect Owners
No information reported.
©2024 FINRA. All rights reserved. Report about HIGGINS CAPITAL MANAGEMENT, INC.

User Guidance
4

103
www.finra.orQ/brokcrcheck
Firm History
This section provides information relating to any successions (e.g., mergers, acquisitions) involving the firm.

No information reported.
©2024 FINRA. All rights reserved. Report about HIGGINS CAPITAL MANAGEMENT, INC.

User Guidance
5

104
www.finra.orQ/brokercheck
Firm Operations
Registrations
This section provides information about the regulators (Securities and Exchange Commission (SEC), self-regulatory organizations (SROs), and U.S. states and territories) with which the brokerage firm is currently registered and licensed, the date the license became effective, and certain information about the firm's SEC registration.

This firm is currently registered with the SEC, 1 SRO and 3 U.S. states and territories.

User Guidance
Fin�
Federal Regulator Status
SEC Approved
SEC Registration Questions
This firm is registered with the SEC as:

A broker-dealer: Yes
A broker-dealer and government securities broker or dealer: Yes A government securities broker or dealer only: No
This firm has ceased activity as a government securities broker or dealer: No Date Effective
02/18/1997
Self-Regulatory Organization
FINRA
Status
Approved
Date Effective
02/18/1997

105
www.finra.ora/brokercheck
Firm Operations
Registrations (continued)
©2024 FINRA. All rights reserved. Report about HIGGINS CAPITAL MANAGEMENT, INC.

User Guidance
Fin�
7 U.S. States &
Territories
Status Date Effective
California Approved 03/24/1997
Georgia Approved 05/05/1997
Idaho Approved 07/11/2019

106
www.finra.orq/brokcrcheck
Firm Operations
Types of Business
This section provides the types of business, including non-securities business, the brokerage firm is engaged in or expects to be engaged in.

This firm currently conducts 7 types of businesses.

Types of Business
Broker or dealer retailing corporate equity securities over-the-counter Broker or dealer selling corporate debt securities
U S. government securities dealer
U S. government securities broker
Municipal securities dealer
Municipal securities broker
Investment advisory services
©2024 FINRA. All rights reserved. Report about HIGGINS CAPITAL MANAGEMENT, INC.

User Guidance
8

107
www.finra.orq/brokercheck
Firm Operations
Clearing Arrangements
This firm does not hold or maintain funds or securities or provide clearing services for other broker-dealer(s).

Introducing Arrangements
This firm does refer or introduce customers to other brokers and dealers.

User Guidance
F1nra'Jl"
Name:

CRD#:

Business Address:

Effective Date:

Description:

RBC CAPITAL MARKETS, LLC
31194
510 MARQUETTE AVE. SOUTH
MAIL STOP M12
MINNEAPOLIS, MN 55402
10/15/2004

HIGGINS CAPITAL HAS A FULLY DISCLOSED CLEARING AGREEMENT WITH RBC CAPITAL MARKETS, LLC.

108
www.finra.oro/brokcrchcck
Firm Operations
Industry Arrangements
This firm does have books or records maintained by a third party.

User Guidance
Name:

CRD#:

Business Address:

Effective Date:

Description:

RBC CAPITAL MARKETS, LLC
31194
510 MARQUETTE AVE. SOUTH
MINNEAPOLIS, MN 55402-1106
10/15/2004

HIGGINS CAPITAL MANAGEMENT HAS A FULLY DISCLOSED CLEARING

ARRANGEMENT WHERE BOOKS AND RECORDS ARE MAINTAINED BY
RBC CAPITAL MARKETS, LLC.

This firm does have accounts, funds, or securities maintained by a third party.

Name:

CRD#:

Business Address:

Effective Date:

Description:

RBC CAPITAL MARKETS, LLC
31194
510 MARQUETTE AVE. SOUTH
MINNEAPOLIS, MN 55402-1106
10/15/2004

HIGGINS CAPITAL HAS A FULLY DISCLOSED CLEARING ARRANGEMENT

WHERE THE APPLICANT'S ACCOUNTS, FUNDS AND SECURITES ARE HELD BY RBC CAPITAL MARKETS, LLC.

This firm does have customer accounts, funds, or securities maintained by a third party.

Name:

CRD#:

Business Address:

Effective Date:

Description:

Control Persons/Financing

RBC CAPITAL MARKETS, LLC
31194
510 MARQUETTE AVE. SOUTH
MINNEAPOLIS, MN 55402-1106
10/15/2004

HIGGINS CAPITAL HAS A FULLY DISCLOSED CLEARING AGREEMENT

WHERE THE CUSTOMERS' ACCOUNTS, FUNDS, AND SECURITIES ARE HELD BY RBC CAPITAL MARKETS, LLC.

109
This firm does not have individuals who control its management or policies through agreement.

This firm does not have individuals who wholly or partly finance the firm's business. ©2024 FINRA. All rights reserved. Report about HIGGINS CAPITAL MANAGEMENT, INC. 10

110
www.finra.ora/brokercheck
Firm Ooerations
Organization Affiliates
This section provides information on control relationships the firm has with other firms in the securities, investment advisory, or banking business.

This firm is not, directly or indirectly:
in control of
• controlled by
• or under common control with
the following partnerships, corporations, or other organizations engaged in the securities or investment advisory business.

This firm is not directly or indirectly, controlled by the following:
bank holding company
national bank
state member bank of the Federal Reserve System
state non-member bank
savings bank or association
credit union
or foreign bank
©2024 FINRA. All rights reserved. Report about HIGGINS CAPITAL MANAGEMENT, INC.

User Guidance
11

111
www.finra.oro/brokcrcheck User Guidance
End of Report
This page is intentionally left blank.
©2024 FINRA. All rights reserved. Report about HIGGINS CAPITAL MANAGEMENT. INC. 12 Page 455 of 1131 112
Attachment F
Trading Authorization

113

CERTIFICATION OF TRADING AUTHORIZATION STATE, COUNTY, MUNICIPALITY OR

POLITICAL SUBDIVISION
TO: HIGGINS CAPITAL MANAGEMENT, INC. (HCM)
You are hereby authorized to open and maintain one or more accounts (the “Account”) on the books of Higgins Capital via its clearing firm, RBC Clearing and Custody in the name of the City of Hermosa Beach (the “Institution”) for the purpose of buying, selling, and trading in those securities and/or other investments, or entering those transactions specified in our Investment Policy under Permissible Investments.

The following individuals are each hereby authorized and empowered, on behalf of the Institution, to open one or more accounts; enter orders for the purchase and sale of Permissible Investments; make and receive payments of money; give written or verbal instructions; deliver, accept delivery and register securities; enter into and execute agreements and take any and all action they deem necessary or advisable to effect transactions relating to the Account, all in accordance with the terms and conditions required by HCM:

City Treasurer

You may deal with any and all of the above individuals as though you were dealing with the Institution directly.

This Authorization shall continue until written notice of amendment or revocation is received by you and, in the case of such amendment or revocation, shall continue effective as to transactions entered into prior to actual receipt of such written notice.

This Authorization shall inure to the benefit of your successors and/or assigns, by merger, consolidation or otherwise.

I certify and warrant that the provisions of this Authorization, as well as our Investment Policy, are in conformity with all state statutes, local ordinances, home rule charter and/or other enabling authorities governing the Institution.

I certify and warrant that the City Council has (Board of Directors of the Institution have) authorized me to execute this Authorization.

Authorized Signature: _________________________ Date: 03/30/2026 Name: David Pedersen
Title: Treasurer

114
Attachment G
Proof of registration - State of California

115

116

CITY OF HERMOSA BEACH

OFFICE OF THE CITY TREASURER

BROKER/DEALER QUESTIONNAIRE AND CERTIFICATION
DUE TUESDAY, APRIL 7, 2026 AT 5:00 PM
The City of Hermosa Beach (hereinafter referred to as the “City") is a General Law city, operating under the council-manager form of government. The City manages an investment portfolio ranging in size from $40 – 55 million. The portfolio is mainly comprised of Treasuries, Negotiable CDs and deposits in the State of California Local Agency Investment Fund (LAIF). Please visit https://www.hermosabeach.gov/our-government/city-officials/city-treasurer to view the City’s latest Investment Report.

The City annually adopts a written Investment Policy, which regulates the standards and procedures used in its cash management activities. A copy of the City's Investment Policy (updated in 2025) is provided with this document. Each broker/dealer must certify that they have read the Policy and will incorporate due diligence in conforming to the provisions of the City's Investment Policy, as well as all applicable State and Federal regulations as they apply to the investment activities of California municipalities.

City personnel will review and substantiate all information and references requested in the document; therefore, please answer all questions as thoroughly as possible.

Based on our review, a select number of firms will be incorporated into Hermosa’s approved Broker/Dealer List. We will seek to incorporate a robust selection of broker/dealers to our list, while noting that practical considerations may limit the number that are included. Inclusion on our approved list does not guarantee any minimum volume and all decisions are at the sole discretion of the City of Hermosa Beach.

Per our investment policy, the City Treasurer will submit our approved list to City Council for their approval.

MULTI-BANK SECURITIES, INC.
8-39547
22098
X 16 17 18
19 1000 TOWN CENTER #2300
SOUTHFIELD MI 48075
10/01/25
26 MICHAEL KARSNER 248-291-1100
40 X 41
Y 42
12/31/25
FORM

FOCUS REPORT
X-17A-5
(FINANCIAL AND OPERATIONAL COMBINED UNIFORM SINGLE REPORT) PART IIA 12
(Please read instructions before preparing Form)
This report is being filed pursuant to (Check Applicable Block(s)):
1) Rule 17a-5(a) 2) Rule 17a-5(b) 3) Rule 17a-11
4) Special request by designated examining authority 5) Other NAME OF BROKER-DEALER SEC. FILE NO.

ADDRESS OF PRINCIPAL PLACE OF BUSINESS (Do not use P.O. Box No.)
FIRM ID NO.

FOR PERIOD BEGINNING (MM/DD/YY)
(No. and Street)

AND ENDING (MM/DD/YY)
(City) (State) (Zip Code)

NAME AND TELEPHONE NUMBER OF PERSON TO CONTACT IN REGARD TO THIS REPORT(Area code) - Telephone No.

NAME(S) OF SUBSIDIARIES OR AFFILIATES CONSOLIDATED IN THIS REPORT
YES NO
EXECUTION:

The registrant/broker or dealer submitting this Form and its attachments and the person(s) by whom
it is executed represent hereby that all information contained therein is true, correct and complete.

It is understood that all required items, statements, and schedules are considered integral parts of
this Form and that the submisson of any amendment represents that all unamended items, statements
and schedules remain true, correct and complete as previously submitted.

Dated the day of 20
Manual Signatures of:
1)
Principal Executive Officer or Managing Partner
2)
Principal Financial Officer or Partner
3)
Principal Operations Officer or Partner
ATTENTION - Intentional misstatements or omissions of facts constitute Federal
Criminal Violations. (See 18 U.S.C. 1001 and 15 U.S.C. 78:f (a) )
FINRA

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

OFFICIAL USE

CHECK HERE IF RESPONDENT IS FILING AN AUDITED REPORT
DOES RESPONDENT CARRY ITS OWN CUSTOMER ACCOUNTS ?
13 14
15 20
21 22 23
24 30 31
32 33
34 35
36 37
38 39
25

4,434,696
X
19,220,499
2,000,000
240,941
620,398,209
124,610,489
MULTI-BANK SECURITIES, INC.
631,444
12/31/25
8-39547
4,434,696
631,444
771,536,278
745,008,698
19,220,499
2,000,000
240,941
770,663,893 872,385
at market value
affiliates, subsidiaries and
under lease agreements, at cost-net
and amortization. ........................
of accumulated depreciation
..............................................
..............................................
$ $
market $
associated partnerships .......................

leasehold improvements and rights
...........................
........................

9. Investment in and receivables from

10. Property, furniture, equipment,

11. Other assets

12. Total Assets
...................................
.........................
as of (MM/DD/YY)
SEC FILE NO.

Consolidated
Unconsolidated
ASSETS
...............
130
$ $

STATEMENT OF FINANCIAL CONDITION FOR NONCARRYING, NONCLEARING AND
.......................
................................
.....................
$
$
$
...............................
............................
.............................
..........................
$
securities accounts, at market value:
securities $
securities
securities
securities
Allowable Non-Allowable Total
$
and partners' individual and capital

1. Cash

7. Secured demand notes:

2. Receivables from brokers or dealers:

3. Receivables from non-customers

4. Securities and spot commodities owned, at market value:

5. Securities and/or other investments not readily marketable:

8. Memberships in exchanges:

6. Securities borrowed under subordination agreements
N 3

PART IIA

BROKER OR DEALER

CERTAIN OTHER BROKERS OR DEALERS

FINANCIAL AND OPERATIONAL COMBINED UNIFORM SINGLE REPORT Market value of collateral:
$

OMIT PENNIES
A. Owned, at
B. Owned, at cost
C. Contributed for use of the company,
A. Exempted
B. Other
A. Exempted
B. Other
A. Exempted securities
B. Debt securities
C. Options
D. Other securities
E. Spot commodities
A. At cost
B. At estimated fair value
A. Clearance account
B. Other
890
850
860
880
810
830
550
600
610
418
419
420
424
430
440
470
460
490
535
540
480
190
......................
170
180
160
150
640
630
650
200
355
660
680
735
740
670
900
920
930
940
910
295
300
750
100
99 98
198
199

9,491,049
21,915,703
9,491,049
26,350,399
692,844,248
16,000
75,192,000
3,484,030
31,406,752
4,434,696
661,437,496
657,002,800 657,002,800
771,536,278
78,692,030
78,692,030
MULTI-BANK SECURITIES, INC. 12/31/25

..............................................................

PART IIA

OMIT PENNIES
...................
..............
.......................
........................
................................
..............................
.........................
.....................
.................................
........................
.......................... $ $
$
$
$
$
...............
....................... $ $
$

FINANCIAL AND OPERATIONAL COMBINED UNIFORM SINGLE REPORT $
$
$
Ownership Equity
...........................
( )
$
$
................................................................... .................................................................... ..................................................................... .................................................................. ........................................................... ......................................................... .............................................
........................................................................... $

BROKER OR DEALER
as of
A.I. Non-A.I.

STATEMENT OF FINANCIAL CONDITION FOR NONCARRYING,

NONCLEARING AND CERTAIN OTHER BROKERS OR DEALERS

LIABILITIES AND OWNERSHIP EQUITY
Liabilities Liabilities Liabilities
Total
1255
1315
1305
1355
1385
1390
1400
1420
1360
1410
1205
1210
1211
1114
1115
1155
1045
980
970
990
1000
1010
1740
1760
1770
1791
1792
1793
1794
1780
1750
1796
1810
1800
1795
1430
1440
1450
1220
1230
1020
of general creditors:
expenses and other
collateral agreements
of
......
use of company, at market value
of
......
qualified for net capital purposes
at market value

16. Securities sold not yet purchased,

17. Accounts payable, accrued liabilities,

18. Notes and mortgages payable:

19. Liabilities subordinated to claims

14. Payable to brokers or dealers:

15. Payable to non-customers

13. Bank loans payable

20. TOTAL LIABILITIES
from outsiders
B. Other
A. Clearance account
B. Securities borrowings, at market value
B. Secured
A. Unsecured
C. Pursuant to secured demand note
A. Cash borrowings:

2. Includes equity subordination (15c3-1(d))

1. from outsiders

2. includes equity subordination (15c3-1(d))

1. from outsiders
D. Exchange memberships contributed for
E. Accounts and other borrowings not

23. Corporation:

21. Sole proprietorship

22. Partnership (limited partners)

24. TOTAL OWNERSHIP EQUITY

25. TOTAL LIABILITIES AND OWNERSHIP EQUITY
B. Common stock
C. Additional paid-in capital
D. Retained earnings
G. Less capital stock in treasury
F. Total
A. Preferred stock
1470
1560
1540
1610
1685
1690
1700
1710
1730
1620
1720
E. Accumulated other comprehensive income ............................................. 1797

MULTI-BANK SECURITIES, INC. 12/31/25
78,692,030
872,385
77,819,645
78,692,030
78,692,030
20,377,770
57,441,875
13,094,634
7,283,136
872,385
3600
3590
3736
3650
3730
3734
3733
3735
3670
3660

3490
3500
3520
3525
3530
3620
3630
3640
3740
3750
)
)
)

OMIT PENNIES
(
(
$ 3480
3540
...............
3610
$
$
$
.................................................
..........................................
............................................
.................................................
.............................................
.........................................
...............................
................................
..............................................
..............................................
...............................................
..........................................
.....................................
................................................
.............................................
....................................................................... $
...................... $
.................................
.....................................
.................................
proprietary capital charges
pursuant to 15c3-1(f)) :

A. Total non-allowable assets from
C. Commodity futures contracts and spot commoditiesStatement of Financial Condition (Notes B and C) B. Secured demand note deficiency

4. Other securities

3. Options

2. Debt securities

1. Exempted securities

4. Add:

6. Deductions and/or charges:

7. Other additions and/or allowable credits (List)

9. Haircuts on securities (computed, where appliicable,

2. Deduct ownership equity not allowable for Net Capital

3. Total ownership equity qualified for Net Capital

5. Total capital and allowable subordinated liabilities

10. Net Capital

8. Net Capital before haircuts on securities positions

1. Total ownership equity from Statement of Financial Condition as of

COMPUTATION OF NET CAPITAL

FINANCIAL AND OPERATIONAL COMBINED UNIFORM SINGLE REPORT

PART IIA

BROKER OR DEALER
(
A. Liabilities subordinated to claims of general creditors allowable in computation of net capital
B. Other (deductions) or allowable credits (List)
D. Other deductions and/or charges
C. Trading and investment securities:

B. Subordinated securities borrowings
A. Contractual securities commitments
D. Undue concentration
E. Other (List)

MULTI-BANK SECURITIES, INC. 12/31/25
100,000
31,406,752
54,301,200
2,093,785
2,093,785
55,348,090

0.00 54.68
31,406,752

FINANCIAL AND OPERATIONAL COMBINED UNIFORM SINGLE REPORT

PART IIA

BROKER OR DEALER
as of
Part A

COMPUTATION OF BASIC NET CAPITAL REQUIREMENT

COMPUTATION OF AGGREGATE INDEBTEDNESS
NOTES:
(A) The minimum net capital requirement should be computed by adding the minimum dollar net capital requirement
of the reporting broker dealer and, for each subsidiary to be consolidated, the greater of:
(B) Do not deduct the value of securities borrowed under subordination agreements or secured demand notes
included in non-allowable assets.
(C) For reports filed pursuant to paragraph (d) of Rule 17a-5, respondent should provide a list of material
non-allowable assets.
equivalent value is paid or credited
%
%
of subsidiaries computed in accordance with Note (A)
A. Drafts for immediate credit
B. Market value of securities borrowed for which no
C. Other unrecorded amounts (List)
$
$
$
................................................
............................................
................................................
......................................................... ..........................................
..........................................
.........................................
...................................
.....................................
........................................................... .........................
....................

1. Minimum dollar net capital requirement, or

2. 6-2/3% of aggregate indebtedness or 4% of aggregate debits if alternative method is used.
3800
3810
3820
exchanges contributed for use of company (contra to item 1740) and partners' securities which were
covered by subordination agreements not in satisfactory form and the market values of the memberships in
$
$
$
$
$
$
$
$

COMPUTATION OF ALTERNATE NET CAPITAL REQUIREMENT
to Rule 15c3-3 prepared as of the date of net capital computation including both

21. 2% of combined aggregate debit items as shown in Formula for Reserve Requirements pursuant Part B

22. Minimum dollar net capital requirement of reporting broker or dealer and minimum net capital

25. Net capital in excess of the greater of:
brokers or dealers and consolidated subsidiaries' debits requirement of subsidiaries computed in accordance with Note (A)

24. Excess net capital (line 10 less 24)
5% of combined aggregate debit items or 120% of minimum net capital requirement

23. Net capital requirement (greater of line 22 or 23)
.........................................
.................................
...............................................
........................................................ ...................... $
$
$
$
$

12. Minimum dollar net capital requirement of reporting broker or dealer and minimum net capital requirement

17. Add:

18. Total aggregate indebtedness

19. Percentage of aggregate indebtedness to net capital (line 19 divided by line 10)

20. Percentage of debt to debt-equity total computed in accordance with Rule 15c-3-1(d)

13. Net capital requirement (greater of line 11 or 12)

14. Excess net capital (line 10 less 13)

15. Net capital less greater of 10% of line 18 or 120% of line 12

11. Minimum net capital required (6-2/3% of line 19)

16. Total A.I. liabilities from Statement of Financial Condition 3870
3880
3910
3920
3760
3840
3850
3860
3830
3790
3758
3760
3770
3756
3780

MULTI-BANK SECURITIES, INC.
537
537
20,274,675
20,274,675
491,366
33,690
15,743,812
536,939
3,682,197
131,977
4,183,613
24,278,538
1,747,463
328,255
1,419,208
312,737
3 5,225,733
26,026,001
10/01/25 12/31/25
1,419,208

REVENUE
STATEMENT OF INCOME (LOSS) or STATEMENT OF COMPREHENSIVE INCOME (as defined in §210.1-02 of Regulation S-X), as applicable

BROKER OR DEALER

MONTHLY INCOME
4070

18. Provision for Federal income taxes (for parent only) 4238

25. Income (current month only) before provision for Federal income taxes ...........................................
.................
3935
3938
3939
3940
3945
3949
3950
3952
3955
3970
3990
3975
3995
4030
4120
4115
4140
4075
4195
4100
4200
4210
4220
4222
4230
4211
....................................................
............................
....................................................................... ............................................................. ...................................................................... ....................................................
....................................................
....................
......................................................................... ........................................................................ ............................
................................................................... ...............................................
..............................................
............................................
...................................................................... .................................................................. .....................................
............................................................. ........................................................... ....................................................
.................
....................................................................... ........................
..............................................
.............................

FINANCIAL AND OPERATIONAL COMBINED UNIFORM SINGLE REPORT

PART IIA
Number of months included in this statement 3931
For the period (MMDDYY) from 3932 to 3933
$
$
$
$
$

a. Includes interest on accounts subject to subordination agreements a. [RESERVED]
a. After Federal income taxes of
a. Commissions on transactions in exchange listed equity securities executed on an exchange b. Commissions on listed option transactions
c. All other securities commissions
d. Total securities commissions
a. From market making in options on a national securities exchange b. From all other trading
c. Total gain (loss)

EXPENSES

NET INCOME/COMPREHENSIVE INCOME

14. Regulatory fees and expenses

15. Other expenses

16. Total expenses

17. Net Income (loss) before Federal income taxes and items below (Item 9 less Item 16)

19. Equity in earnings (losses) of unconsolidated subsidiaries not included above

20. [RESERVED]

21. [RESERVED]

22. Net income (loss) after Federal income taxes

12. Commissions paid to other brokers-dealers

13. Interest expense

11. Other employee compensation and benefits

10. Salaries and other employment costs for general partners and voting stockholder officers

1. Commissions:

2. Gains or losses on firm securities trading accounts

5. Revenue from sale of investment company shares

6. Commodities revenue

7. Fees for account supervision, investment advisory and administrative services

8. Other revenue

9. Total revenue

4. Profits (losses) from underwriting and selling groups

3. Gains or losses on firm securities investment accounts

23. Other Comprehensive income (loss) ..................................................... 4226 a. After Federal income taxes of ........................................... 4227

24. Comprehensive income (loss) ......................................................... 4228 $
$

MULTI-BANK SECURITIES, INC.
10/01/25 12/31/25
9,000,000 9,000,000
0 78,692,030
68,272,822
1,419,208

BROKER OR DEALER
For the period (MMDDYY) from to

FINANCIAL AND OPERATIONAL COMBINED UNIFORM SINGLE REPORT

PART IIA

3. Balance, beginning of period 4300
4310
4272 )
4262 )

1. Balance, beginning of period
4320

STATEMENT OF CHANGES IN OWNERSHIP EQUITY
(SOLE PROPRIETORSHIP, PARTNERSHIP OR CORPORATION)

STATEMENT OF CHANGES IN LIABILITIES SUBORDINATED

TO CLAIMS OF GENERAL CREDITORS

2. Balance, end of period (from item 1800)

4. Balance, end of period (from item 3520) 4330
............................................................... ..................................................................... ........................................................ ............................................................... ......................................................................... ......................................................................... ........................................................ $
$

OMIT PENNIES
...........................
............................ $
$
$
$
4290
4270
4260
4250
4240
A. Net income (loss)
B. Additions (includes non-conforming capital of
C. Deductions (includes non-conforming capital of
A. Increases
B. Decreases

12/31/25

PERSHING, LLC X
MULTI-BANK SECURITIES, INC.

TOTAL
Ownership Equity and Subordinated Liabilities maturing or proposed to be
withdrawn within the next six months and accruals, (as defined below),
which have not been deducted in the computation of Net Capital.

C. (k) (2) (ii) - All customer transactions cleared through another broker-dealer on a fully disclosed basis.

25. If an exemption from Rule 15c3-3 is claimed, identify below the section upon which such exemption is based :

Name(s) of Clearing Firm(s) - Please separate multiple names with a semi-colon
A. (k) (1) - Limited business (mutual funds and/or variable annuities only)
..................................
$ 4550
B. (k) (2) (i) - "Special Account for the Exclusive
Benefit of customers" maintained .............................. 4560 D. (k) (3) - Exempted by order of the Commission .......................................................... 4580 4335 4570
Name of Lender or Contributor
$

FINANCIAL AND OPERATIONAL COMBINED UNIFORM SINGLE REPORT

PART IIA
Exemptive Provision Under Rule 15c3-3

BROKER OR DEALER
as of
Type of Proposed
Expect
to
Renew
(Yes or No)
4605
4615
4625
4635
4645
4655
4665
4675
4685
4695
4604
4614
4624
4634
4644
4654
4664
4674
4684
4694
(MMDDYY)
Withdrawal
or Maturity
Date
4603
4613
4623
4633
4643
4653
4663
4673
4683
4693
4699

OMIT PENNIES
Amount to be withdrawn (cash amount
and/or Net Capital
Value of Securities)
4692
4682
4672
4662
4652
4642
4632
4622
4612
4602
Insider or
Outsider ?
(In or Out)
Detail listing must include the total of items maturing during the six month period following the
report date, regardless of whether or not the capital
contribution is expected to be renewed. The
schedule must also include proposed capital withdrawals scheduled within the six month
period following the report date including the proposed redemption of stock and payments of
liabilities secured by fixed assets (which are considered allowable assets in the capital computation
pursuant to Rule 15c3-1(c) (2) (iv)), which could be required by the lender on demand or in less
than six months.

4601
4611
4621
4631
4641
4651
4661
4671
4681
4691
Withdrawal or
Accrual
(See below for
code to enter)
Instructions:

WITHDRAWAL CODE: DESCRIPTION

1. Equity Capital

2. Subordinated Liabilities

3. Accruals

4. 15c3-1(c) (2) (iv) Liabilities
4600
4610
4620
4630
4640
4650
4660
4670
4680
4690

Our Commitment
As with all clients, we seek to maximize portfolio returns within the constraints of the municipality’s investment policy. MBS has implemented reasonable procedures and a system of controls designed to prevent imprudent investment activities conducted between our institution and our clients. We accomplish this by thoroughly reviewing the corresponding state’s investment guidelines as well as those of the municipality interested in placing the trade. We exercise diligence in informing our clients of all foreseeable risks associated with any financial transactions conducted with our institution.

Our decades of experience have earned us the trust and respect of the industry and our clients.

We would like the opportunity to work with you and offer you the same great service and expertise our customers have come to expect.

MULTI- BANK SECURITIES, INC.

STATEMENT OF FINANCIAL CONDITION
December 31, 2024
Filed Pursuant to Rule 17a-5 (e) (3) Under the Securities Exchange Act of 1934 As a Public Document

BrokerCheck Report
MULTI-BANK SECURITIES, INC.

Section Title
Report Summary
Firm History
CRD# 22098
1 8
Firm Profile 2 - 7
Page(s)
Firm Operations 9 - 15
Disclosure Events 16
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www.finra.org/brokercheck User Guidance
This firm is classified as a corporation.

This firm was formed in Michigan on 08/17/1987.

CRD#
This section provides the brokerage firm's full legal name, "Doing Business As" name, business and mailing addresses, telephone number, and any alternate name by which the firm conducts business and where such name is used.

Firm Profile
Firm Names and Locations
Its fiscal year ends in December.

MULTI-BANK SECURITIES, INC.

SEC#
22098
8-39547
Main Office Location
Mailing Address
Business Telephone Number
Doing business as MULTI-BANK SECURITIES, INC.
248-291-1100
Regulated by FINRA Chicago Office
1000 TOWN CENTER #2300
SOUTHFIELD, MI 48075
1000 TOWN CENTER #2300
SOUTHFIELD, MI 48075
©2025 FINRA. All rights reserved. Report about MULTI-BANK SECURITIES, INC. 2

www.finra.org/brokercheck User Guidance
This section provides information relating to all direct owners and executive officers of the brokerage firm.

Direct Owners and Executive Officers
Firm Profile
Position
Percentage of Ownership
Is this a public reporting
company?
Position Start Date
Does this owner direct the
management or policies of
the firm?
MULTI-BANK SERVICES, LTD.

SOLE SHAREHOLDER
75% or more
No
Domestic Entity
08/1987
Yes
Is this a domestic or foreign
entity or an individual?
Legal Name & CRD# (if any):

Position
Percentage of Ownership
Is this a public reporting
company?
Position Start Date
Does this owner direct the
management or policies of
the firm?

DREWS, MICHAEL WAYNE

VICE CHAIRMAN
Less than 5%
No
Individual
07/2012
Yes
1664216
Is this a domestic or foreign
entity or an individual?
Legal Name & CRD# (if any):

Position

Position Start Date

ELSNER, MERLIN AUBERON
CCO

Individual
08/2009
5593423
Is this a domestic or foreign
entity or an individual?
Legal Name & CRD# (if any):
©2025 FINRA. All rights reserved. Report about MULTI-BANK SECURITIES, INC. 3

www.finra.org/brokercheck User Guidance
Direct Owners and Executive Officers (continued)
Firm Profile
Percentage of Ownership
Is this a public reporting
company?
Does this owner direct the
management or policies of
the firm?
Less than 5%
No
No
Position
Percentage of Ownership
Is this a public reporting
company?
Position Start Date
Does this owner direct the
management or policies of
the firm?

KARSNER, MICHAEL STEPHEN

CHIEF FINANCIAL OFFICER/TREASURER
Less than 5%
No
Individual
07/2012
Yes
5751851
Is this a domestic or foreign
entity or an individual?
Legal Name & CRD# (if any):

Position
Percentage of Ownership
Is this a public reporting
company?
Position Start Date
Does this owner direct the
management or policies of
the firm?

MACCAGNONE, DAVID THOMAS

CEO, CHAIRMAN
Less than 5%
No
Individual
12/1988
Yes
811479
Is this a domestic or foreign
entity or an individual?
Legal Name & CRD# (if any):

Legal Name & CRD# (if any): MACCAGNONE, JEFFERY THOMAS
©2025 FINRA. All rights reserved. Report about MULTI-BANK SECURITIES, INC. 4

www.finra.org/brokercheck User Guidance
Direct Owners and Executive Officers (continued)
Firm Profile
Position
Percentage of Ownership
Is this a public reporting
company?
Position Start Date
Does this owner direct the
management or policies of
the firm?

PRESIDENT/SECRETARY
Less than 5%
No
Individual
07/2012
Yes
2077369
Is this a domestic or foreign
entity or an individual?
©2025 FINRA. All rights reserved. Report about MULTI-BANK SECURITIES, INC. 5

www.finra.org/brokercheck User Guidance
This section provides information relating to any indirect owners of the brokerage firm.

Indirect Owners
Firm Profile

MACCAGNONE, DAVID THOMAS

CHAIRMAN, CEO, PRESIDENT, DIRECTOR
MULTI-BANK SERVICES, LTD.
50% but less than 75%
No
Individual
03/1988
Yes
811479
Legal Name & CRD# (if any):

Is this a domestic or foreign
entity or an individual?
Company through which
indirect ownership is
established
Relationship to Direct Owner
Relationship Established
Percentage of Ownership
Does this owner direct the
management or policies of
the firm?
Is this a public reporting
company?

DREWS, MICHAEL WAYNE

DIRECTOR
MULTI-BANK SERVICES, LTD.

Other General Partners
No
Individual
07/2012
Yes
1664216
Legal Name & CRD# (if any):

Is this a domestic or foreign
entity or an individual?
Company through which
indirect ownership is
established
Relationship to Direct Owner
Relationship Established
Percentage of Ownership
Does this owner direct the
management or policies of
the firm?
Is this a public reporting
company?
Legal Name & CRD# (if any): MACCAGNONE, JEFFERY THOMAS
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Indirect Owners (continued)
Firm Profile

SECRETARY/TREASRER/DIRECTOR
MULTI-BANK SERVICES, LTD.

Other General Partners
No
Individual
07/2012
Yes
2077369
Is this a domestic or foreign
entity or an individual?
Company through which
indirect ownership is
established
Relationship to Direct Owner
Relationship Established
Percentage of Ownership
Does this owner direct the
management or policies of
the firm?
Is this a public reporting
company?
©2025 FINRA. All rights reserved. Report about MULTI-BANK SECURITIES, INC. 7

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Firm History
This section provides information relating to any successions (e.g., mergers, acquisitions) involving the firm.

No information reported.
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Firm Operations
Registrations
This section provides information about the regulators (Securities and Exchange Commission (SEC), self-regulatory organizations (SROs), and U.S. states and territories) with which the brokerage firm is currently registered and licensed, the date the license became effective, and certain information about the firm's SEC registration.

This firm is currently registered with the SEC, 1 SRO and 53 U.S. states and territories.

SEC Registration Questions
This firm is registered with the SEC as:

A broker-dealer:

A broker-dealer and government securities broker or dealer:

A government securities broker or dealer only:

This firm has ceased activity as a government securities broker or dealer:

Yes
Yes
No
No
Federal Regulator Status Date Effective
SEC Approved 05/06/1988
Self-Regulatory Organization Status Date Effective
FINRA Approved 12/23/1988
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Firm Operations
Registrations (continued)
U.S. States &
Territories
Status Date Effective
Alabama Approved 11/07/1994
Alaska Approved 03/27/1997
Arizona Approved 10/11/2001
Arkansas Approved 05/02/1997
California Approved 03/30/1994
Colorado Approved 04/23/1991
Connecticut Approved 08/20/1998
Delaware Approved 10/11/1994
District of Columbia Approved 03/30/1994
Florida Approved 02/05/1991
Georgia Approved 02/28/1994
Hawaii Approved 04/05/1995
Idaho Approved 03/20/1997
Illinois Approved 07/13/1989
Indiana Approved 03/24/1997
Iowa Approved 03/31/1994
Kansas Approved 05/04/1994
Kentucky Approved 03/08/1994
Louisiana Approved 09/07/1994
Maine Approved 05/24/1994
Maryland Approved 03/11/1994
Massachusetts Approved 07/25/1994
Michigan Approved 08/31/1988
Minnesota Approved 09/02/1994
Mississippi Approved 03/04/1994
Missouri Approved 05/02/2002
Montana Approved 02/14/1994
Nebraska Approved 11/02/1994
Nevada Approved 05/23/1994
New Hampshire Approved 09/28/1995
New Jersey Approved 11/09/1994
New Mexico Approved 08/02/1994
New York Approved 06/05/1996
U.S. States &
Territories
Status Date Effective
North Carolina Approved 08/02/1994
North Dakota Approved 04/25/1997
Ohio Approved 11/21/1994
Oklahoma Approved 06/04/1991
Oregon Approved 04/04/1997
Pennsylvania Approved 03/07/1994
Puerto Rico Approved 02/10/2000
Rhode Island Approved 03/02/1994
South Carolina Approved 08/04/1994
South Dakota Approved 03/04/1994
Tennessee Approved 08/04/1994
Texas Approved 06/29/1990
Utah Approved 01/19/1994
Vermont Approved 06/18/1997
Virgin Islands Approved 01/30/2012
Virginia Approved 05/16/1994
Washington Approved 10/04/1989
West Virginia Approved 01/28/1994
Wisconsin Approved 09/06/1991
Wyoming Approved 08/08/1994
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Firm Operations
Types of Business
This section provides the types of business, including non-securities business, the brokerage firm is engaged in or expects to be engaged in.

Other Types of Business
This firm does effect transactions in commodities, commodity futures, or commodity options.

This firm does not engage in other non-securities business.

Non-Securities Business Description:

This firm currently conducts 13 types of businesses.

Types of Business
Broker or dealer retailing corporate equity securities over-the-counter Broker or dealer selling corporate debt securities
Underwriter or selling group participant (corporate securities other than mutual funds) Mutual fund retailer
U S. government securities dealer
U S. government securities broker
Municipal securities dealer
Municipal securities broker
Solicitor of time deposits in a financial institution
Put and call broker or dealer or option writer
Trading securities for own account
Private placements of securities
Broker or dealer selling interests in mortgages or other receivables ©2025 FINRA. All rights reserved. Report about MULTI-BANK SECURITIES, INC. 11

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Firm Operations
Clearing Arrangements
This firm does not hold or maintain funds or securities or provide clearing services for other broker-dealer(s).

Introducing Arrangements
This firm does refer or introduce customers to other brokers and dealers.

Name: PERSHING LLC
Business Address: ONE PERSHING PLAZA
JERSEY CITY, NJ 07399
CRD #: 7560
Effective Date: 03/10/2010
Description: PERSHING LLC ACTS AS CORRESPONDENT CLEARING AGENT ON A FULLY DISCLOSED BASIS FOR MULTI-BANK SECURITIES, INC.

CUSTOMERS ARE INTRODUCED TO PERSHING LLC ON A FULLY
DISCLOSED BASIS.
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Firm Operations
Industry Arrangements
This firm does have books or records maintained by a third party.

This firm does have accounts, funds, or securities maintained by a third party.

This firm does have customer accounts, funds, or securities maintained by a third party.

This firm does not have individuals who control its management or policies through agreement.

Control Persons/Financing
Name: PERSHING LLC
Business Address: ONE PERSHING PLAZA
JERSEY CITY, NJ 07399
CRD #: 7560
Effective Date: 03/10/2010
Description: PERSHING LLC ACTS AS CORRESPONDENT CLEARING AGENT ON A FULLY DISCLOSED BASIS FOR MULTI-BANK SECURITIES, INC.

CUSTOMERS ARE INTRODUCED TO PERSHING LLC ON A FULLY
DISCLOSED BASIS.

Name: PERSHING LLC
Business Address: ONE PERSHING PLAZA
JERSEY CITY, NJ 07399
CRD #: 7560
Effective Date: 03/10/2010
Description: PERSHING LLC ACTS AS CORRESPONDENT CLEARING AGENT ON A FULLY DISCLOSED BASIS FOR MULTI-BANK SECURITIES, INC.

CUSTOMERS ARE INTRODUCED TO PERSHING LLC ON A FULLY
DISCLOSED BASIS.

Name: PERSHING LLC
Business Address: ONE PERSHING PLAZA
JERSEY CITY, NJ 07399
CRD #: 7560
Effective Date: 03/10/2010
Description: PERSHING LLC ACTS AS CORRESPONDENT CLEARING AGENT ON A FULLY DISCLOSED BASIS FOR MULTI-BANK SECURITIES, INC.

CUSTOMERS ARE INTRODUCED TO PERSHING LLC ON A FULLY
DISCLOSED BASIS.
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Firm Operations
Industry Arrangements (continued)
This firm does not have individuals who wholly or partly finance the firm's business. ©2025 FINRA. All rights reserved. Report about MULTI-BANK SECURITIES, INC. 14

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Firm Operations
Organization Affiliates
This section provides information on control relationships the firm has with other firms in the securities, investment advisory, or banking business.

This firm is not, directly or indirectly:
· in control of
· controlled by
· or under common control with
the following partnerships, corporations, or other organizations engaged in the securities or investment advisory business.

This firm is not directly or indirectly, controlled by the following:
· bank holding company
· national bank
· state member bank of the Federal Reserve System
· state non-member bank
· savings bank or association
· credit union
· or foreign bank
©2025 FINRA. All rights reserved. Report about MULTI-BANK SECURITIES, INC. 15

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Disclosure Events
All firms registered to sell securities or provide investment advice are required to disclose regulatory actions, criminal or civil judicial proceedings, and certain financial matters in which the firm or one of its control affiliates has been involved.

For your convenience, below is a matrix of the number and status of disclosure events involving this brokerage firm or one of its control affiliates. Further information regarding these events can be found in the subsequent pages of this report.

Pending Final On Appeal
Regulatory Event 0 4 0
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Disclosure Event Details
What you should know about reported disclosure events:

1. BrokerCheck provides details for any disclosure event that was reported in CRD. It also includes summary information regarding FINRA arbitration awards in cases where the brokerage firm was named as a respondent.

2. Certain thresholds must be met before an event is reported to CRD, for example:
o A law enforcement agency must file formal charges before a brokerage firm is required to disclose a particular criminal event.

3. Disclosure events in BrokerCheck reports come from different sources:
o Disclosure events for this brokerage firm were reported by the firm and/or regulators. When the firm and a regulator report information for the same event, both versions of the event will appear in the BrokerCheck report. The different versions will be separated by a solid line with the reporting source labeled.

4. There are different statuses and dispositions for disclosure events:
o A disclosure event may have a status of pending, on appeal, or final. § A "pending" event involves allegations that have not been proven or formally adjudicated. § An event that is "on appeal" involves allegations that have been adjudicated but are currently being appealed.
§ A "final" event has been concluded and its resolution is not subject to change. o A final event generally has a disposition of adjudicated, settled or otherwise resolved. § An "adjudicated" matter includes a disposition by (1) a court of law in a criminal or civil matter, or (2) an administrative panel in an action brought by a regulator that is contested by the party charged with some alleged wrongdoing.
§ A "settled" matter generally involves an agreement by the parties to resolve the matter.

Please note that firms may choose to settle customer disputes or regulatory matters for business or other reasons.
§ A "resolved" matter usually involves no payment to the customer and no finding of wrongdoing on the part of the individual broker. Such matters generally involve customer disputes.

5. You may wish to contact the brokerage firm to obtain further information regarding any of the disclosure events contained in this BrokerCheck report.

Regulatory - Final
This type of disclosure event involves (1) a final, formal proceeding initiated by a regulatory authority (e.g., a state securities agency, self-regulatory organization, federal regulator such as the U.S. Securities and Exchange Commission, foreign financial regulatory body) for a violation of investment-related rules or regulations; or (2) a revocation or suspension of the authority of a brokerage firm or its control affiliate to act as an attorney, accountant or federal contractor.

Disclosure 1 of 4
Reporting Source: Regulator

Current Status: Final
©2025 FINRA. All rights reserved. Report about MULTI-BANK SECURITIES, INC. 17

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Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTED

TO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT FAILED TO

ADEQUATELY DISCLOSE TO ITS MUNICIPAL CUSTOMERS WHETHER IT WAS

ACTING AS A MUNICIPAL ADVISOR (MA) OR MERELY A BROKER-DEALER IN

MUNICIPAL TRANSACTIONS, AND IT DID NOT HAVE ADEQUATE

PROCEDURES IN PLACE TO ENSURE COMPLIANCE WITH THE NEW
MUNICIPAL ADVISOR RULES. THE FINDINGS STATED THAT UNDER THESE

NEW RULES, SUBJECT TO CERTAIN EXEMPTIONS, ANY PERSON WHO

PROVIDES ADVICE TO ANY MUNICIPAL ENTITY CONCERNING THE

INVESTMENT OF PROCEEDS OF THE ISSUANCE OF MUNICIPAL
SECURITIES OR ESCROW INVESTMENTS IS ACTING AS AN MA. PURSUANT TO SECURITIES EXCHANGE ACT RULE 15B, AN MA AND ANY PERSON

ASSOCIATED WITH SUCH MA SHALL BE DEEMED TO HAVE A FIDUCIARY

DUTY TO ANY MUNICIPAL ENTITY FOR WHOM IT ACTS AS A MUNICIPAL ADVISOR. THE FIRM REGISTERED AS AN MA WITH THE SECURITIES

EXCHANGE COMMISSION AND IT SENT A CONSENT FORM TO ITS

MUNICIPAL CUSTOMERS THAT DISCLOSED THAT IT HAD REGISTERED AS

AN MA, THAT IT INTENDED TO ACT AS A BROKER-DEALER AND NOT AS AN MA, AND CERTAIN OTHER REQUIREMENTS AND DISCLOSURES OF MAS.

THE CONSENT FORM ALSO REQUIRED THAT THE CLIENT DISCLOSE

WHETHER THE INVESTED PROCEEDS ORIGINATED FROM BOND
PROCEEDS. THE CONSENT FORM WAS VAGUE AND CONFUSING BECAUSE

IT DID NOT ADEQUATELY DISCLOSE WHETHER THE FIRM WOULD BE ACTING AS AN MA, OR MERELY AS A BROKER-DEALER. AS A RESULT, THE

FIRM VIOLATED MSRB RULE THAT REQUIRES EACH MUNICIPAL
SECURITIES DEALER AND MA TO DEAL FAIRLY WITH ALL PERSONS. IN

ADDITION, THE FIRM DID NOT HAVE ADEQUATE WRITTEN SUPERVISORY

PROCEDURES AND PROCESSES IN PLACE TO ASCERTAIN WHETHER IT

WAS ACTING AS AN MA, WHETHER AN EXEMPTION FROM MA STATUS

APPLIED, WHETHER THE MUNICIPALITY WAS INVESTING BOND PROCEEDS

AND THE NATURE AND SCOPE OF THE REQUIRED DISCLOSURES, DURING ANY TIMES IT WAS ACTING AS AN MA. CONSEQUENTLY, THE FIRM VIOLATED THE APPLICABLE MSRB RULE. THE FINDINGS ALSO STATED

THAT THE FIRM DID NOT HAVE ADEQUATE PROCEDURES IN PLACE TO ENSURE COMPLIANCE WITH ASPECTS OF THE MARKET ACCESS RULE.

THE FIRM FAILED TO ESTABLISH ADEQUATE WRITTEN SUPERVISORY

PROCEDURES REASONABLY DESIGNED TO SYSTEMATICALLY LIMIT THE

FINANCIAL EXPOSURE THAT COULD ARISE AS A RESULT OF MARKET

ACCESS, INCLUDING PREVENTING THE ENTRY OF ORDERS THAT EXCEED

APPROPRIATE PRE-SET CREDIT OR CAPITAL THRESHOLDS, AND
PREVENTING THE ENTRY OF ERRONEOUS ORDERS. THE FIRM ALSO

FAILED TO DOCUMENT THE RISK MANAGEMENT CONTROLS AND

SUPERVISORY CONTROLS IT HAD IN PLACE WITH THE ALTERNATIVE

TRADING SYSTEMS TO PREVENT, ON A PRE-ORDER BASIS, DUPLICATIVE

OR ERRONEOUS ORDERS, OR ORDERS THAT EXCEEDED PRE-SET CREDIT

©2025 FINRA. All rights reserved. Report about MULTI-BANK SECURITIES, INC. 18

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Initiated By: FINRA
Principal Sanction(s)/Relief
Sought:

Other Sanction(s)/Relief
Sought:

Date Initiated: 04/10/2017
Docket/Case Number: 2016048230901
Principal Product Type: No Product
Other Product Type(s):

OR CAPITAL THRESHOLDS.

Resolution Date: 04/10/2017
Resolution:

Other Sanctions Ordered:

Sanction Details: THE FIRM WAS CENSURED AND FINED $35,000. FINES PAID IN FULL MAY 4, 2017.

Does the order constitute a
final order based on
violations of any laws or
regulations that prohibit
fraudulent, manipulative, or
deceptive conduct?
No
Sanctions Ordered: Censure
Monetary/Fine $35,000.00
Acceptance, Waiver & Consent(AWC)
Reporting Source: Firm
Allegations: MULTI-BANK VIOLATED MSRB RULES G-17 AND G-27 BECAUSE IT FAILED

TO ADEQUATELY DISCLOSE TO ITS MUNICIPAL CUSTOMERS WHETHER IT

WAS ACTING AS A MUNICIPAL ADVISOR OR MERELY A BROKER-DEALER IN

MUNICIPAL TRANSACTIONS, AND BECAUSE IT DID NOT HAVE ADEQUATE

PROCEDURES IN PLACE TO ENSURE COMPLIANCE WITH THE NEW
MUNICIPAL ADVISOR RULES. MULTI-BANK ALSO VIOLATED SEA RULE 15C3- 5 AND FINRA RULE 3110 BECAUSE IT DID NOT HAVE ADEQUATE

PROCEDURES IN PLACE TO ENSURE COMPLIANCE WITH ASPECTS OF THE MARKET ACCESS RULE.

Current Status: Final
©2025 FINRA. All rights reserved. Report about MULTI-BANK SECURITIES, INC. 19

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Initiated By: FINRA
Principal Sanction(s)/Relief
Sought:

Censure
Other Sanction(s)/Relief
Sought:

Date Initiated: 04/10/2017
Docket/Case Number: 2016048230901
Principal Product Type: No Product
Other Product Type(s):

Resolution Date: 05/03/2017
Resolution:

Other Sanctions Ordered:

Sanction Details: MULTI-BANK VIOLATED MSRB RULES G-17 AND G-27 BECAUSE IT FAILED

TO ADEQUATELY DISCLOSE TO ITS MUNICIPAL CUSTOMERS WHETHER IT

WAS ACTING AS A MUNICIPAL ADVISOR OR MERELY A BROKER-DEALER IN

MUNICIPAL TRANSACTIONS, AND BECAUSE IT DID NOT HAVE ADEQUATE

PROCEDURES IN PLACE TO ENSURE COMPLIANCE WITH THE NEW
MUNICIPAL ADVISOR RULES. MULTI-BANK ALSO VIOLATED SEA RULE 15C3- 5 AND FINRA RULE 3110 BECAUSE IT DID NOT HAVE ADEQUATE

PROCEDURES IN PLACE TO ENSURE COMPLIANCE WITH ASPECTS OF THE MARKET ACCESS RULE.

Firm Statement FINRA DEPOSITED OUR PAYMENT PER REVIEW OF PAYMENT SUBMITTED Sanctions Ordered: Censure
Monetary/Fine $35,000.00
Acceptance, Waiver & Consent(AWC)
Disclosure 2 of 4
Reporting Source: Regulator
Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTED

TO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT FAILED TO

REPORT THE CORRECT TIME OF TRADE EXECUTION FOR TRANSACTIONS

IN TRADE REPORTING AND COMPLIANCE ENGINE (TRACE)-ELIGIBLE SECURITIZED PRODUCTS TO TRACE; FAILED TO REPORT TRANSACTIONS IN TRACE-ELIGIBLE SECURITIZED PRODUCTS WITHIN 15 MINUTES OF THE TIME OF EXECUTION TO TRACE; AND FAILED TO SHOW THE CORRECT TIME OF EXECUTION ON THE MEMORANDUM OF BROKERAGE ORDERS.

Current Status: Final
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Initiated By: FINRA
Principal Sanction(s)/Relief
Sought:

Other Sanction(s)/Relief
Sought:

Date Initiated: 05/08/2015
Docket/Case Number: 2014040026601
Principal Product Type: Other
Other Product Type(s): UNSPECIFIED SECURITIES
Resolution Date: 05/08/2015
Resolution:

Other Sanctions Ordered:

Sanction Details: THE FIRM WAS CENSURED AND FINED $7,500. FINE PAID IN FULL ON 5/22/2015.

Does the order constitute a
final order based on
violations of any laws or
regulations that prohibit
fraudulent, manipulative, or
deceptive conduct?
No
Sanctions Ordered: Censure
Monetary/Fine $7,500.00
Acceptance, Waiver & Consent(AWC)
Reporting Source: Firm
Initiated By: FINRA
Date Initiated: 02/05/2015
Docket/Case Number: 20140400266
Principal Product Type: Other
Other Product Type(s): SECURITIZED PRODUCTS
Allegations: AS A RESULT OF ITS SWEEP, FINRA FOUND THAT THE FIRM INCORRECTLY RECORDED AND REPORTED THE TIME OF EXECUTION OF CERTAIN INTERDEALER TRANSACTIONS.

Current Status: Final
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Principal Sanction(s)/Relief
Sought:

Censure
Other Sanction(s)/Relief
Sought:

FINE OF $7,500
Resolution Date: 05/07/2015
Resolution:

Other Sanctions Ordered: CENSURE AND FINE OF $7,500.00
FINRA FINANCE DEPARTMENT RECEIVED PAYMENT IN FULL ON 05/22/2015 Sanction Details: CENSURE AND FINE OF $7,500.00
Firm Statement FINRA FINANCE DEPARTMENT RECEIVED PAYMENT IN FULL ON 05/22/2015 Sanctions Ordered: Censure
Monetary/Fine $7,500.00
Acceptance, Waiver & Consent(AWC)
Disclosure 3 of 4
Reporting Source: Regulator
Initiated By: VERMONT SECURITIES DIVISION
Principal Sanction(s)/Relief
Sought:

Other Sanction(s)/Relief
Sought:

Date Initiated: 06/12/1997
Docket/Case Number: 97-027-S
URL for Regulatory Action:

Principal Product Type:

Other Product Type(s):

Allegations: TRANSACTING BUSINESS AS AN UNREGISTERED
BROKER-DEALER.

Current Status: Final
Resolution Date: 06/12/1997
Resolution:

Other Sanctions Ordered:

Sanctions Ordered: Monetary/Fine $1,000.00
Consent
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Sanction Details: RESPONDENT ENTERED INTO A CONSENT ORDER AND AGREED TO PAY A $1,000.00 ADMINISTRATIVE FINE, $250.00 IN COSTS AND $991.00 IN BACK REGISTRATION FEES AND INTEREST. RESPONDENT IS NOW REGISTERED IN VERMONT.

Regulator Statement CONTACT: ENFORCEMENT ATTORNEY 802-828-3420.

Reporting Source: Firm
Initiated By: VERMONT SECURITIES DIVISION
Principal Sanction(s)/Relief
Sought:

Other
Other Sanction(s)/Relief
Sought:

TRANSACTING BUSINESS AS AN UNREGISTERED BROKER-DEALER
Date Initiated: 06/12/1997
Docket/Case Number: 97 027 S
Principal Product Type: Debt - Government
Other Product Type(s): CD'S
Allegations: TRANSACTING BUSINESS AS AN UNREGISTERED BROKER-DEALER Current Status: Final
Resolution Date: 06/18/1997
Resolution:

Other Sanctions Ordered: NONE -- FIRM NOW LICENSED IN VERMONT Sanction Details: CONSENT ORDER ENTERED SOLELY FOR PURPOSE OF SETTLEMENT OF THIS MATTER AND IN LIEU OF ANY PROCEEDING OR ACTION. WITHOUT

TRIAL OR ADJUDICATION OF ANY ISSUE OR FACT OF LAW WITHOUT

EITHER ADMITTING OR DENYING THE TRUTH OF THE COMMISSIONER'S ALLEGATIONS, THE FIRM PAID $1000 ADMINISTRATIVE COST, $250 COSTS, AND $991 BACK REGISTRATION FEES AND INTEREST.

Sanctions Ordered: Monetary/Fine $2,241.00
Consent
Disclosure 4 of 4
Reporting Source: Regulator
Allegations: CONSENT ORDER ENTERED, ADMINISTRATIVE

Current Status: Final
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Initiated By: AL
Principal Sanction(s)/Relief
Sought:

Other Sanction(s)/Relief
Sought:

Date Initiated: 06/16/1994
Docket/Case Number: OD-94-0034
URL for Regulatory Action:

Principal Product Type:

Other Product Type(s):

ASSESSMENT OF $1,000 AND INVESTIGATIVE COSTS OF $500. DENIAL ORDER OF JUNE 16, 1994 (ISSUED DUE TO AN INCOMPLETE B/D APPLICATION) IS HEREBY RESOLVED BY THIS CONSENT ORDER.

Resolution Date: 11/07/1994
Resolution:

Other Sanctions Ordered:

Sanction Details: SAME AS ALLEGATIONS
Regulator Statement SAME AS ALLEGATIONS CONTACT: ALABAMA SECURITIES COMMISSION (205) 242-2984
Sanctions Ordered:

Consent
Reporting Source: Firm
Initiated By: STATE OF ALABAMA
Principal Sanction(s)/Relief
Sought:

Denial
Date Initiated: 06/16/1994
Docket/Case Number: OD 940034 AND CO 940034
Principal Product Type: No Product
Other Product Type(s):

Allegations: DENIAL OF INITIAL BROKER-DEALER APPLICATION Current Status: Final
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Other Sanction(s)/Relief
Sought:

Resolution Date: 11/07/1994
Resolution:

Other Sanctions Ordered: CONSENT ORDER
Sanction Details: 1000.00 ADMINISTRATIVE COST
500.00 DENIAL ORDER

BOTH PAID TO RESOLVED DENIAL OF BD APPLICATION
CONSENT ORDER FILED NOVEMBER 7, 1994
Firm Statement DURING THE INITIAL APPLICATION TO THE STATE OF ALABAMA, MULTIBANK SECURITIES, INC. INCORRECTLY FILLED OUT THE PAPERWORK.

ALABAMA DENIED REGISTRATION PRIOR TO CORRECTIONS.

ALABAMA VACATED THE DENIAL ORDER FOLLOWING THE PAPERWORK CORRECTIONS.

Sanctions Ordered: Monetary/Fine $1,500.00
Consent
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End of Report
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©2025 FINRA. All rights reserved. Report about MULTI-BANK SECURITIES, INC. 26

CITY OF HERMOSA BEACH

OFFICE OF THE CITY TREASURER

BROKER/DEALER QUESTIONNAIRE AND CERTIFICATION
DUE TUESDAY, APRIL 7, 2026 AT 5:00 PM
The City of Hermosa Beach (hereinafter referred to as the “City") is a General Law city, operating under the council-manager form of government. The City manages an investment portfolio ranging in size from $40 – 55 million. The portfolio is mainly comprised of Treasuries, Negotiable CDs and deposits in the State of California Local Agency Investment Fund (LAIF). Please visit https://www.hermosabeach.gov/our-government/city-officials/city-treasurer to view the City’s latest Investment Report.

The City annually adopts a written Investment Policy, which regulates the standards and procedures used in its cash management activities. A copy of the City's Investment Policy (updated in 2025) is provided with this document. Each broker/dealer must certify that they have read the Policy and will incorporate due diligence in conforming to the provisions of the City's Investment Policy, as well as all applicable State and Federal regulations as they apply to the investment activities of California municipalities.

City personnel will review and substantiate all information and references requested in the document; therefore, please answer all questions as thoroughly as possible.

Based on our review, a select number of firms will be incorporated into Hermosa’s approved Broker/Dealer List. We will seek to incorporate a robust selection of broker/dealers to our list, while noting that practical considerations may limit the number that are included. Inclusion on our approved list does not guarantee any minimum volume and all decisions are at the sole discretion of the City of Hermosa Beach.

Per our investment policy, the City Treasurer will submit our approved list to City Council for their approval.

Section I. General Information
Name of Firm Raymond James & Associates, Inc.

Local Address 33971 Selva Road, Suite 100 Dana Point, CA 92629 Main Address 880 Carillon Parkway, St. Petersburg, FL 33716 Telephone No. 866-261-3367
Primary Representative Manager/Partner-in-Charge
Name Rosa Schulte Donald Hughes
Title Managing Director Managing Director, Branch Mgr
Telephone 886-261-3367 415-616-8015
No. of Yrs. in Institutional Sales 24 32
No. of Yrs. with Firm 24 24
Section II. Questionnaire

1. Are you a Primary Dealer in U.S. Government Securities? No

2. Are you a Regional Dealer in U.S. Government Securities? Yes A. Please attach most recent Financial and Operational Combined Uniform Single (FOCUS) report.

3. Are you a Broker instead of a Dealer, i.e. you DO NOT own positions of Securities? No

4. What is the net capitalization of your Firm?
Raymond James & Associates, Inc. has a net capitalization of $998,051,579.

5. What is the date of your Firm's fiscal year-end? September 30

6. If you are a depository institution, please provide the following and most current certified and audited information specific to your Tangible, Core, and Risk-Based Capital Ratios:

Not applicable. Raymond James & Associates, Inc. is a broker-dealer and not a depository institution.

7. Is your Firm owned by a Holding Company? If so, what is its name and net capitalization? Yes. Raymond James & Associates, Inc. is a wholly owned subsidiary of Raymond James Financial, Inc., a publicly traded financial holding company listed on the New York Stock Exchange (NYSE: RJF).

As a financial holding company, Raymond James Financial, Inc. is not subject to broker-dealer net capital requirements. Instead, it reports regulatory capital metrics, including Tier 1 capital ratios, in its public filings. As of the most recently reported period, Raymond James Financial maintains Tier 1 capital levels well in excess of regulatory “well-capitalized” thresholds.

For full capitalization details, refer to the firm’s Form 10-K available on the Raymond James Investor Relations website.

8. a) Identify California public sector clients who are directly comparable to the City of Hermosa Beach and who we may contact as part of our review and verification process.

Entity Contact Person Telephone No. Client Since
City of Carlsbad Christian Peacox 442-339-5119 10/2004
City of San Clemente Charlie Smith 949-413-6090 05/2008 City of Burbank Krystle Palmer 818-238-5879 03/2018
City of Glendale Rafi Manoukian 818-548-2066 05/2018
City of Huntington Beach Jason Schmitt 714-536-5299 03/2016 b) Please describe your institutional trading practices and experience.

Raymond James & Associates, Inc. engages in a full range of securities-related business and maintains a dedicated Fixed Income Capital Markets division serving institutional clients, including public entities, financial institutions, corporations, and investment managers.

The firm actively trades:
• U.S. Treasuries
• Agencies (FHLB, FNMA, FHLMC, FFCB, FAMCA, TVA, SLMA)
• Corporate Bonds
• Commercial Paper
• Municipal Bonds
• Mortgage-Backed Securities (MBS)
• Asset-Backed Securities (ABS)
• Supranationals
Raymond James & Associates, Inc. acts as principal in fixed income transactions and maintains secondary inventory positions in the products it trades (with the exception of Treasuries). The firm is a direct underwriter of Agency debt and is perennially ranked among the top underwriters of GSE securities.

Additionally, Raymond James is a top 10 underwriter of municipal bonds nationally.

Trading is reviewed by sales and trading management on an ongoing basis to ensure adherence to client Page 526 of 1131 investment policy parameters. The firm clears securities on a delivery versus payment (DVP) basis and is a self-clearing broker-dealer for DTC-eligible securities. For government-related issues, Raymond James utilizes the services of Bank of New York.

Institutional clients may view Raymond James inventory positions electronically via Bloomberg. The firm provides real-time market color, daily offering sheets, and research support through its fixed income trading and strategy teams.
c) Please describe your familiarity with the California Government Code as it relates to investments by a public entity.

Raymond James & Associates, Inc. has significant experience serving California public agencies and is familiar with the requirements of California Government Code Section 53600 et seq.

We understand that public funds must be managed under the Prudent Investor Standard (Section 53600.3), with safety of principal as the primary objective, liquidity as the secondary objective, and yield considered only after those objectives are met.

We also recognize that local agencies adopt Investment Policies in conformance with the Government Code. For example, the City of Hermosa Beach Investment Policy states it is prepared in accordance with California Government Code Sections 53600 et seq. (Page 1) and establishes authorized investment types, maturity limits, and diversification constraints (Pages 5–6).

In working with California public entities, Raymond James:
• Reviews and maintains the agency’s adopted Investment Policy on file • Structures recommendations within statutory and policy-specific limits • Monitors credit quality and issuer concentration
• Aligns maturities with anticipated cash flow needs
• Executes transactions on a delivery-versus-payment (DVP) basis In addition, Rosa Schulte, the City’s assigned representative, has nearly 25 years of experience working almost exclusively on serving California local governments in their investment needs. As such, she is highly familiar with the California Government Code, including permissible investments, maturity limits, and rating requirements.

9. Have any of your public-sector clients ever sustained a loss on a securities transaction arising from a misunderstanding or misrepresentation of the risk characteristics of the instrument?
Yes No

If yes, please explain: To the best of our knowledge, no.

10. Please provide your Wiring and Delivery Instructions.

For security and fraud-prevention purposes, Raymond James & Associates, Inc. does not publish standing wiring instructions within public questionnaires.

Official wiring and delivery instructions are provided separately under secure cover and are verbally verified through established internal callback procedures prior to any transfer of funds.

11. Which of the following instruments are offered regularly by your local desk? T-Bills
Treasury Notes/Bonds
Discount Notes
Certificates of Deposit
Agencies (specify) FHLB, FNMA, FHLMC, FFCB, FAMCA, TVA, and SLMA BAs (Domestic)
BAs (Foreign)
Commercial Paper
Medium Term Notes
Repurchase Agreements
Reverse Repurchase Agreements
CMO's
Asset Backed Investments
Mutual Funds
Other Investments as Authorized by Section 53600 of the Government Code:

Supranationals and Municipal Bonds

12. Which of the instruments listed above does your Firm specialize in Marketing? • U.S. Treasuries (T-Bills, Notes, and Bonds)
• U.S. Agency Securities (FHLB, FNMA, FHLMC, FFCB, TVA, FAMCA) • Supranationals
• Corporate Bonds
• Commercial Paper
• Municipal Bonds
Additionally, Raymond James is a direct underwriter of agency and municipal debt and is consistently ranked as a top 10 underwriter nationally. The firm also maintains secondary inventory in the products it markets.

13. What reports, transactions, confirmations and documents would we receive? Will they be in electronic form?
Raymond James & Associates, Inc. provides:
• Standard confirmations
• Trade comparisons
• Customer account statements
• Letters (when applicable)
In addition to hard copy confirmations, Raymond James sends a trade ticket at the time of trade via Bloomberg’s BXT/SXT function via Bloomberg or email.

Confirmations and statements may be delivered electronically through secure delivery systems, in addition to traditional hard copy.

14. Please include sample of research reports or market information that your firm regularly provides to local agency clients. Please include sample Daily Offering sheets or similar with your proposal and indicate your ability to provide this electronically with real-time pricing.

See attached.

15. What precautions are taken by your Firm to protect the interest of the public when dealing with government agencies as investors?
In order to protect the interest of the public when dealing with government agencies as investors, Raymond James & Associates, Inc. has comprehensive policies and procedures for risk management covering credit, trading, sales practices, legal, compliance, and operations.

Investment policies are reviewed and kept on file by the sales representative and branch manager.

Trading is reviewed by sales and trading management on an ongoing basis to ensure that investment policy parameters are met. Page 529 of 1131
Raymond James also requires evidence of trading authority from its public accounts and clears securities on a delivery versus payment (DVP) basis.

16. Have you or your Firm been censured, sanctioned or disciplined by a Regulatory, State or Federal Agency for improper or fraudulent activities, related to the sale of securities within the last five years?
Yes No
If yes, please explain: Ms. Schulte has not been subject to any censure, sanction or discipline.

Raymond James engages in a full range of securities-related business. As a result of its size and in line with other full-service firms in its industry, Raymond James and certain associates have been involved in a modest number of lawsuits, regulatory actions, and investigations, in addition to the matters disclosed on BrokerCheck.

Some of these matters have touched upon Raymond James’s activities as they relate to fixed income securities. To the best of our knowledge, there are no regulatory or litigation matters pending that would jeopardize Raymond James’s ability to perform or continue performing services for public-sector clients.

17. Please indicate and provide evidence of the current licensing status of the City’s representatives:

Agent: Rosa Schulte Licenses or Registration: See attached Broker Check Report Agent: Licenses or Registration:

18. Is your Firm a member of NASD/FINRA? Yes No
Does your firm subscribe to the “Rules of Fair Practice?” Yes. As a FINRA member firm, Raymond James & Associates, Inc. is subject to and complies with FINRA Rules of Fair Practice and all applicable SEC regulations governing broker-dealers.

19. Please supply the following supplemental documents:
 Most recent audited Annual Financial Statement
 FOCUS Report, if applicable
 Proof of FINRA registration
 Trading Resolution
 Proof of State of California registrations

Section III. Certification
I have completed and am returning the following, including requested supplemental documents:
1) Broker/Dealer Questionnaire
2) Certification of Understanding, and
3) Receipt of Investment Policy.

Electronic Submission is encouraged and should be sent jointly to the contacts below or through the City’s PlanetBids portal:

City of Hermosa Beach
David Pedersen, City Treasurer [email protected] Brandon Walker, Administrative Services Director [email protected] 1315 Valley Drive
Hermosa Beach, CA 90254
Broker/Dealer
Raymond James & Associates, Inc.

Donald Hughes
Date

CITY OF HERMOSA BEACH

OFFICE OF THE CITY TREASURER

BROKER/DEALER QUESTIONNAIRE AND CERTIFICATION
DUE TUESDAY, APRIL 7, 2026 AT 5:00 PM
The City of Hermosa Beach (hereinafter referred to as the “City") is a General Law city, operating under the council-manager form of government. The City manages an investment portfolio ranging in size from $40 – 55 million. The portfolio is mainly comprised of Treasuries, Negotiable CDs and deposits in the State of California Local Agency Investment Fund (LAIF). Please visit https://www.hermosabeach.gov/our-government/city-officials/city-treasurer to view the City’s latest Investment Report.

The City annually adopts a written Investment Policy, which regulates the standards and procedures used in its cash management activities. A copy of the City's Investment Policy (updated in 2025) is provided with this document. Each broker/dealer must certify that they have read the Policy and will incorporate due diligence in conforming to the provisions of the City's Investment Policy, as well as all applicable State and Federal regulations as they apply to the investment activities of California municipalities.

City personnel will review and substantiate all information and references requested in the document; therefore, please answer all questions as thoroughly as possible.

Based on our review, a select number of firms will be incorporated into Hermosa’s approved Broker/Dealer List. We will seek to incorporate a robust selection of broker/dealers to our list, while noting that practical considerations may limit the number that are included. Inclusion on our approved list does not guarantee any minimum volume and all decisions are at the sole discretion of the City of Hermosa Beach.

Per our investment policy, the City Treasurer will submit our approved list to City Council for their approval.

Section I. General Information
Name of Firm
Local Address
Main Address
Telephone No.

Primary Representative
Name
Title
Telephone
No. of Yrs. in Institutional Sales
No. of Yrs. with Firm
Section II. Questionnaire

1. Are you a Primary Dealer in U.S. Government Securities?

2. Are you a Regional Dealer in U.S. Government Securities? A. Please attach most recent Financial and Operational Combined Uniform Single (FOCUS) report.

3. Are you a Broker instead of a Dealer, i.e. you DO NOT own positions of Securities?

4. What is the net capitalization of your Firm?

5. What is the date of your Firm's fiscal year-end? December 31st USBA's Net Capitalization is $159,597,841 as of March 3, 2026. 213-356-2367
800-358-8771
800 N Brand Blvd Glendale, CA 91203
U.S. Bancorp Advisors LLC
Mark Kreymer
Director, Fixed Income Sales
24 years
25 years
No
No
*USBA is both a broker and a dealer
Yes
21700 Oxnard St Woodland Hills, CA 91367
Manager/Partner In Charge
213-356-2363
Sales & Trading Manager
Shane Triplett
20 years
13 years

6. If you are a depository institution, please provide the following and most current certified and audited information specific to your Tangible, Core, and Risk-Based Capital Ratios:

7. Is your Firm owned by a Holding Company? If so, what is its name and net capitalization?

8. a) Identify California public sector clients who are directly comparable to the City of Hermosa Beach and who we may contact as part of our review and verification process.

Entity Contact Person Telephone No. Client Since
b) Please describe your institutional trading practices and experience.

c) Please describe your familiarity with the California Government Code as it relates to investments by a public entity.

9. Have any of your public-sector clients ever sustained a loss on a securities transaction arising from a misunderstanding or misrepresentation of the risk characteristics of the instrument?
Yes No
Our Institutional trading practice is led by Mark Kreymer, a 25-year industry veteran with deep experience serving and permitted investments.

CA local govenments and County Investment pools. We leverage the Bank's resources and long standing trader relationships to deliver customized solutions.
capitalization of $68.2B
US Bancorp Advisors is wholly-owned by US Bancorp, a holding company with a market .

USBA is a subsidary of US Bancorp along with U.S. Bank NA. The Capital ratios are as follows: Core Capital Ratio:

City of Carlsbad
City of Thousand Oaks
City of Pasadena
City of Long Beach
City of Burbank
Christian Peacox
Vic Erganian
Jane Adelmann
Dayronee Alvarez
Krystle Palmer
562-570-6174
626-744-4422
805-449-2221
818-238-5880
442-339-5119 2013
2012
2012
2013
2024
Government code governing public-fund investments, including statutory requirements for safety, liquidity, and Mark has deep experience supporting California cities and counties and is highly familiar with the California

10.6%, Tangible Capital Ratio of 6.9%, and Total Risk-Based Capital Ratio of 14.7%

If yes, please explain:

10. Please provide your Wiring and Delivery Instructions.

11. Which of the following instruments are offered regularly by your local desk? T-Bills
Treasury Notes/Bonds
Discount Notes
Certificates of Deposit
Agencies (specify) FHLB, FNMA, FHLMC, FFCB, GNMA, TVA, and SLMA BAs (Domestic)
BAs (Foreign)
Commercial Paper
Medium Term Notes
Repurchase Agreements
Reverse Repurchase Agreements
CMO's
Asset Backed Investments
Mutual Funds
Other Investments as Authorized by Section 53600 of the Government Code

12. Which of the instruments listed above does your Firm specialize in Marketing?

13. What reports, transactions, confirmations and documents would we receive? Will they be in electronic form?

14. Please include sample of research reports or market information that your firm regularly provides to local agency clients. Please include sample Daily Offering sheets or similar with your proposal amd indicate your ability to provide this electronically with real-time pricing.

15. What precautions are taken by your Firm to protect the interest of the public when dealing with government agencies as investors?

16. Have you or your Firm been censured, sanctioned or disciplined by a Regulatory, State or Federal Agency for improper or fraudulent activities, related to the sale of securities within the last five years?
Yes No
If yes, please explain:
confirmations if requested. Monthly account statements are also provided. All documents may be delivered electronically or by mail, according to client preference. compliance, strong supervisory and compliance oversight, and a commitment to fair dealing, transparency, and best execution in all transactions.

Following each transaction, clients receive a detailed trade package via email, as well as formal trade U.S. Bancorp Advisors LLC protects the interests of public entity investors through strict regulatory other local agency clients USBA serves, Mark and the desk specialize in offering US Treasuries, US Government Agencies, High Grade Corporate Bonds, Taxable Municipal Bonds, as well as Money-Market Securities (CP,CDs, etc.).

Given the many
Please see sample reasearch and offering sheets attached. USBA is commited to fair market, real-time pricing in our bids and offers.

17. Please indicate and provide evidence of the current licensing status of the City’s representatives:

Agent: Licenses or Registration:

Agent: Licenses or Registration:

18. Is your Firm a member of NASD/FINRA? Yes No
Does your firm subscribe to the “Rules of Fair Practice?”

19. Please supply the following supplemental documents:
 Most recent audited Annual Financial Statement
 FOCUS Report, if applicable
 Proof of FINRA registration
 Trading Resolution
 Proof of State of California registrations
Mark Kreymer
Michael Lanier CRD: 7978577
CRD: 4377658
Yes. U.S. Bancorp Advisors, LLC is a registered broker dealer and a member of FINRA. As a FINRA member firm, we are subject to and comply with FINRA's rules and standards of conduct, including the principles formerly known as the NASD Rules of Fair Practice.

Section III. Certification
 I have completed and am returning the following, including requested supplemental documents:
1) Broker/Dealer Questionnaire
2) Certification of Understanding, and
3) Receipt of Investment Policy.

Electronic Submission is encouraged and should be sent jointly to the contacts below or through the City’s PlanetBids portal:

City of Hermosa Beach
David Pedersen, City Treasurer [email protected] Brandon Walker, Administrative Services Director [email protected] 1315 Valley Drive
Hermosa Beach, CA 90254
Broker/Dealer

Date
3/19/26
U.S. Bancorp Advisors LLC

CITY OF HERMOSA BEACH

CERTIFICATION OF UNDERSTANDING
The City of Hermosa Beach Investment Policy as approved by the City Council requires that all Financial Institutions and Investment Managers doing business with the City sign a Certification of Understanding acknowledging that:

1. You have read and are familiar with the City’s Investment Policy and Guidelines as well as applicable Federal and State laws.

2. You meet the requirements as outlined in the City’s Investment Policy.

3. You agree to make every reasonable effort to protect the assets of the City from loss.

4. You agree to notify the City in writing of any potential conflicts of interest.

5. You agree to notify the City in writing of any changes in personnel with decision-making authority over the City’s funds within 24 hours of such event.

Failure to submit a Certification of Understanding shall result in the withdrawal by the City of all funds held by the financial institution or investment manager and the immediate revocation of any rights to act as an agent of the City for the purchase of securities or investment of funds on behalf of the City.

SIGNED: DATE:

Print Name and Title:

City of Hermosa Beach use only:

Approved:______ Disapproved:______ Date:

Signature:_________________________
Date Notification sent:___________ Sent by:

Mark Kreymer, Director, Fixed Income Sales and Trading
3/19/26

CITY OF HERMOSA BEACH

BROKER-DEALER RECEIPT OF INVESTMENT POLICY
We are in receipt of the City of Hermosa Beach’s Investment Policy.

We have read the policy and understand the provisions and guidelines of the policy. All representatives covering the City’s account will be made aware of this policy and will be directed to give consideration to its provisions and constraints in selecting investment opportunities to present to the City.

Signed:

Name Name

Title Title
Firm Name
Date
City of Hermosa Beach use only:

Approved:______ Disapproved:______ Date:

Signature:_________________________
Date Notification sent:___________ Sent by:

U.S. Bancorp Advisors LLC
Director, Fixed Income Sales and Trading Institutional Sales Assistant 3/19/26

City of Hermosa Beach | Page 1 of 4
Meeting Date: June 9, 2026
Staff Report No. 26-PW-038
Honorable Mayor and Members of the Hermosa Beach City Council AWARD OF CONSTRUCTION CONTRACT FOR CIP 107 CITYWIDE SLURRY SEAL

PROJECT
CEQA: The Project is exempt under the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines section 15301 (Existing Facilities). The project consists of surface improvements of an existing public roadway. The roadway will not be widened and work will be performed within the existing roadway footprint. (Public Works Director Joe SanClemente)
Recommended Action:

Staff recommends City Council:

1. Award a construction contract for the Capital Improvement Program (CIP) 107 – Citywide Slurry Seal Project to Pavement Coatings Co. in the amount of $222,310 (Attachment 1);

2. Authorize the Director of Public Works to establish a project contingency amount of $44,500 (approximately 20% of the contract amount) and approve contract change orders up to the amount of the approved project contingency;

3. Adopt the attached resolution entitled “A Resolution of the City Council of the City of Hermosa Beach Approving the Construction of CIP 107 Citywide Slurry Seal Project Pursuant to Government Code Section 830.6 and Establishing a Project Payment Account” (Attachment 2);

4. Authorize the City Manager to execute the construction contract, approve minor modifications if necessary, and the City Clerk to attest, subject to approval by the City Attorney;

5. Authorize the Director of Public Works to file a Notice of Completion following final completion of the Project; and

6. Authorize the Director of Public Works, or designee, to file a Notice of Exemption with the Los Angeles County Clerk in accordance with CEQA Guidelines Section 15062.

Executive Summary:

The Project includes crack sealing of existing pavement and; removal of existing striping and markers, installation of Type II slurry with 2.5% Latex and striping and signage at various locations within the City (Attachment 3). Staff received 6 bids for the construction of the Project, and recommends City Council award a construction contract to the lowest responsible and responsive bidder Pavement Coatings Co.

City of Hermosa Beach | Page 2 of 4
Background:

As part of the Fiscal Year 2025-26 budget process staff identified the need to incorporate citywide slurry seal improvements as part of the annual street improvement program as a cost effective way to extend the lifespan of the City’s roadways and work towards maintaining, and improving, the Pavement Condition Index (PCI). The 2024 Pavement Management Program (PMP) recommends applying crack sealing and slurry seals to pavements in ‘Excellent’ or ‘Good’ condition categories to preserve pavement quality and extend service life.

The Project includes slurry and crack sealing on approximately 230,000 square feet (1.8 mile) of roadway across various residential street segments as well as within the basketball play area at Clark Field along the westerly side of the loop road. The project will also include crack sealing on Hermosa Avenue from Herondo Street to 10th Street.

The scope of work includes, but is not limited to, crack sealing of existing pavement and; removal and replacement of existing striping and markers, installation of Type II slurry seal with 2.5% Latex and new striping and signage at various locations.

Analysis:

On April 30, 2026, the City issued Notice Inviting Bids 26-002 inviting experienced contractors to submit a bid for the project. The Project was advertised for formal competitive bids in the local newspaper, on the City’s electronic bidding platform Planet Bids, and in relevant construction trade journals for a period of three weeks. On March 21, 2026, the City Clerk received a total of 6 bids, which were opened and read aloud by the City Clerk. The bid results are provided in Attachment 4 and summarized below.

Bid Results

BIDDER BID AMOUNT
Pavement Coatings Co. $222,310.00
Union Pavement Services, Inc. $238,440.00
Ray Allan Slurry Seal, Inc. $276,551.90
American Asphalt South, Inc $278,297.10
All American Asphalt $354,455.00
Estate Design and Construction $356,810.00
Staff reviewed bids received and found Pavement Coatings Co. the lowest bidder to be a responsive and responsible bidder, with a bid in the amount of $222,310 (Attachment 5).

Staff confirmed that Pavement Coatings Co.’s contractor license is active and in good standing with the Contractor’s State License Board. Staff contacted references and

City of Hermosa Beach | Page 3 of 4
confirmed competency through completion of recent projects of similar types of work within the past five years.

Staff also verified that Pavement Coatings Co. meets applicable public works requirements, including registration with the California Department of Industrial Relations, and is not listed on any state or Federal debarment lists. Overall, staff finds that Pavement Coatings Co. to be a qualified contractor to complete the Project and recommends City Council approve award of the construction contract.

If awarded, staff would provide construction management with additional support provided by one of the City’s on-call public works inspectors that specializes in roadway rehabilitation. Staff anticipates construction to start in July 2026 and to be completed by September 2026.

Environmental Analysis:

The Project is exempt under CEQA Class 15301 (“Existing Facilities”), Class 1c as it consists of surface improvements of an existing public roadway. The Project will occur within the existing public right-of-way and does not expand the footprint, capacity, or use of the existing facilities.

Options for City Council Consideration:

City Council may consider the following options relating to the award of the construction contract.
1) Award the construction contract to Pavement Coatings Co. to allow the Project to start. The Project will help maintain and improve citywide pavement condition and reduce long term maintenance costs (Recommended).
2) Reject the construction contract and the Project will not start. The City’s roadways will deteriorate without proper maintenance and result in higher maintenance costs.

Fiscal Impact:

The project is budgeted in the Fiscal Year 2025-26 Adopted Budget and funded with the Capital Improvement Fund (301) with a total budget of $450,000. The lowest responsive and responsible bidder, Pavement Coatings Co. submitted its bid at $222,310. Staff recommends establishing a contingency of $44,462 to cover any unforeseen conditions or additional work required during construction, for a total construction contract budget not to exceed $266,772.

Sufficient funds are available in the Capital Improvement Fund to cover construction costs for the Project. The funds would cover the full construction costs for the Project.

City of Hermosa Beach | Page 4 of 4
Agreement Request
Description Request
Amount
FY 2025-26 Budget
Dept. Account #
Total Contract
Amount
Pavement Coatings Co. $222,310 301-8107-4201 $222,310
20% Project Contingency $44,462 $44,462
Total $266,772 $266,772
Attachments:

1. Draft Construction Contract

2. Draft Resolution

3. CIP 107 Location Map

4. Bid Summary Sheet

5. Bid Documents for Pavement Coatings Co.

6. CIP 107 Project Plans

7. CIP 107 Project Specifications
Respectfully Submitted by: Magvern By, Assistant Engineer Concur: Heecheol Kwon, Senior Engineer
Concur: Joe SanClemente, Public Works Director
Noted for Fiscal Impact: Henry Chao, Finance Manager
Reviewed by: Brandon Walker, Administrative Services Director Legal Review: Jason Baltimore, Interim City Attorney
Approved: Steve Napolitano, City Manager

BBK (01/2026)
City of Hermosa Beach
Hermosa Beach, CALIFORNIA

CONTRACT DOCUMENTS AND SPECIFICATIONS FOR
CIP NO. 107
Citywide Slurry Seal Project

65270.00021\44496819.1
City of Hermosa Beach
BBK (01/2026) -iTABLE OF CONTENTS

TABLE OF CONTENTS
Page
I NOTICE INVITING BIDS.................................................................................................5 II INSTRUCTIONS TO BIDDERS.......................................................................................8 ARTICLE 1. SECURING DOCUMENTS.............................................................................8 ARTICLE 2. EXAMINATION OF SITE AND CONTRACT DOCUMENTS............................8 ARTICLE 3. INTERPRETATION OF DRAWINGS AND DOCUMENTS ..............................8 ARTICLE 4. PRE-BID CONFERENCE ...............................................................................9 ARTICLE 5. ADDENDA......................................................................................................9 ARTICLE 6. ALTERNATE BIDS .........................................................................................9 ARTICLE 7. COMPLETION OF BID FORMS .....................................................................9 ARTICLE 8. MODIFICATIONS OF BIDS ..........................................................................10 ARTICLE 9. SUBCONTRACTORS...................................................................................10 ARTICLE 10. LICENSING REQUIREMENTS...................................................................10 ARTICLE 11. BID GUARANTEE (BOND).........................................................................10 ARTICLE 12. IRAN CONTRACTING ACT OF 2010 .........................................................11 ARTICLE 13. NONCOLLUSION DECLARATION .............................................................11 ARTICLE 14. PUBLIC WORKS CONTRACTOR REGISTRATION
CERTIFICATION .....................................................................................................11 ARTICLE 15. BIDDER INFORMATION AND EXPERIENCE FORM.................................12 ARTICLE 16. WORKERS' COMPENSATION CERTIFICATION.......................................12 ARTICLE 17. SIGNING OF BIDS .....................................................................................12 ARTICLE 18. SUBMISSION OF SEALED BIDS ...............................................................12 ARTICLE 19. OPENING OF BIDS....................................................................................13 ARTICLE 20. 14WITHDRAWAL OF BID...........................................................................13 ARTICLE 21. BIDDERS INTERESTED IN MORE THAN ONE BID ..................................13 ARTICLE 22. SUBSTITUTION OF SECURITY.................................................................14 ARTICLE 23. PREVAILING WAGES................................................................................14 ARTICLE 24. DEBARMENT OF CONTRACTORS AND SUBCONTRACTORS ...............14 ARTICLE 25. INSURANCE REQUIREMENTS .................................................................14 ARTICLE 26. PERFORMANCE BOND AND PAYMENT BOND
REQUIREMENTS....................................................................................................14 ARTICLE 27. SALES AND OTHER APPLICABLE TAXES, PERMITS,
LICENSES AND FEES............................................................................................14 ARTICLE 28. PERMIT AND INSPECTION FEE ALLOWANCE ........................................15 ARTICLE 29. FILING OF BID PROTESTS .......................................................................15

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City of Hermosa Beach

TABLE OF CONTENTS
(Continued)
Page
BBK (01/2026) -ii- TABLE OF CONTENTS
ARTICLE 30. BASIS OF AWARD; BALANCED BID .........................................................15 ARTICLE 31. AWARD PROCESS....................................................................................16 ARTICLE 32. EXECUTION OF CONTRACT ....................................................................16 ARTICLE 33. QUESTIONS...............................................................................................16 III BID FORMS ..................................................................................................................17 ARTICLE 1. INFORMATION ABOUT BIDDER .................................................................27 ARTICLE 2. LIST OF CURRENT PROJECTS (BACKLOG)..............................................30 ARTICLE 3. LIST OF COMPLETED PROJECTS – LAST THREE YEARS.......................31 ARTICLE 4. EXPERIENCE AND TECHNICAL QUALIFICATIONS
QUESTIONNAIRE...................................................................................................32 ARTICLE 5. VERIFICATION AND EXECUTION...............................................................33 IV CONTRACT ..................................................................................................................39 V BOND FORMS............................................................................................................433 VI GENERAL CONDITIONS..............................................................................................54 ARTICLE 1. DEFINED TERMS ........................................................................................54 ARTICLE 2. CONTRACT DOCUMENTS..........................................................................58 ARTICLE 3. PRECONSTRUCTION AND CONSTRUCTION
COMMUNICATION..................................................................................................59 ARTICLE 4. CONTRACT DOCUMENTS: COPIES & MAINTENANCE............................59 ARTICLE 5. EXAMINATION OF DRAWINGS, SPECIFICATIONS AND SITE OF WORK ...............................................................................................................59 ARTICLE 6. MOBILIZATION ............................................................................................60 ARTICLE 7. EXISTENCE OF UTILITIES AT THE WORK SITE........................................61 ARTICLE 8. SOILS INVESTIGATIONS ............................................................................61 ARTICLE 9. CONTRACTOR’S SUPERVISION ................................................................62 ARTICLE 10. WORKERS .................................................................................................62 ARTICLE 11. INDEPENDENT CONTRACTORS..............................................................62 ARTICLE 12. SUBCONTRACTS ......................................................................................63 ARTICLE 13. VERIFICATION OF EMPLOYMENT ELIGIBILITY ......................................63 ARTICLE 14. REQUESTS FOR SUBSTITUTION.............................................................63 ARTICLE 15. SHOP DRAWINGS.....................................................................................65 ARTICLE 16. SUBMITTALS .............................................................................................65 ARTICLE 17. MATERIALS ...............................................................................................65

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TABLE OF CONTENTS
(Continued)
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ARTICLE 18. PERMITS AND LICENSES.........................................................................66 ARTICLE 19. TRENCHES................................................................................................66 ARTICLE 20. TRAFFIC CONTROL ..................................................................................67 ARTICLE 21. DIVERSION OF RECYCLABLE WASTE MATERIALS ...............................68 ARTICLE 22. REMOVAL OF HAZARDOUS MATERIALS ................................................68 ARTICLE 23. SANITARY FACILITIES..............................................................................69 ARTICLE 24. AIR POLLUTION CONTROL ......................................................................69 ARTICLE 25. LAYOUT AND FIELD ENGINEERING ........................................................69 ARTICLE 26. TESTS AND INSPECTIONS.......................................................................69 ARTICLE 27. PROTECTION OF WORK AND PROPERTY..............................................70 ARTICLE 28. CONTRACTOR’S MEANS AND METHODS...............................................70 ARTICLE 29. AUTHORIZED REPRESENTATIVES .........................................................70 ARTICLE 30. HOURS OF WORK.....................................................................................70 ARTICLE 31. PAYROLL RECORDS; LABOR COMPLIANCE ..........................................72 ARTICLE 32. PREVAILING RATES OF WAGES .............................................................73 ARTICLE 33. PUBLIC WORKS CONTRACTOR REGISTRATION ...................................74 ARTICLE 34. EMPLOYMENT OF APPRENTICES...........................................................74 ARTICLE 35. NONDISCRIMINATION/EQUAL EMPLOYMENT OPPORTUNITY .............74 ARTICLE 36. DEBARMENT OF CONTRACTORS AND SUBCONTRACTORS ...............75 ARTICLE 37. LABOR/EMPLOYMENT SAFETY...............................................................75 ARTICLE 38. INSURANCE...............................................................................................76 ARTICLE 39. FORM AND PROOF OF CARRIAGE OF INSURANCE ..............................78 ARTICLE 40. TIME FOR COMPLETION AND LIQUIDATED DAMAGES.........................79 ARTICLE 41. COST BREAKDOWN AND PERIODIC ESTIMATES..................................80 ARTICLE 42. PROGRESS ESTIMATES AND PAYMENT................................................81 ARTICLE 43. SECURITIES FOR MONEY WITHHELD.....................................................82 ARTICLE 44. CHANGES AND EXTRA WORK.................................................................82 ARTICLE 45. FINAL ACCEPTANCE AND PAYMENT......................................................97 ARTICLE 46. OCCUPANCY.............................................................................................98 ARTICLE 47. INDEMNIFICATION....................................................................................98 ARTICLE 48. PROCEDURE FOR RESOLVING DISPUTES ............................................99 ARTICLE 49. CITY’S RIGHT TO TERMINATE CONTRACT ..........................................103 ARTICLE 50. WARRANTY AND GUARANTEE OF WORK............................................106

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City of Hermosa Beach

TABLE OF CONTENTS
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BBK (01/2026) -iv- TABLE OF CONTENTS
ARTICLE 51. DOCUMENT RETENTION & EXAMINATION...........................................108 ARTICLE 52. SEPARATE CONTRACTS........................................................................109 ARTICLE 53. NOTICE AND SERVICE THEREOF .........................................................109 ARTICLE 54. NOTICE OF THIRD PARTY CLAIMS........................................................109 ARTICLE 55. STATE LICENSE BOARD NOTICE ..........................................................109 ARTICLE 56. INTEGRATION .........................................................................................110 ARTICLE 57. ASSIGNMENT OF CONTRACT................................................................110 ARTICLE 58. CHANGE IN NAME AND NATURE OF CONTRACTOR’S LEGAL ENTITY.....................................................................................................110 ARTICLE 59. ASSIGNMENT OF ANTITRUST ACTIONS...............................................110 ARTICLE 60. PROHIBITED INTERESTS.......................................................................110 ARTICLE 61. CONTROLLING LAW ...............................................................................111 ARTICLE 62. JURISDICTION; VENUE...........................................................................111 ARTICLE 63. LAWS AND REGULATIONS.....................................................................111 ARTICLE 64. PATENTS.................................................................................................111 ARTICLE 65. OWNERSHIP OF CONTRACT DOCUMENTS .........................................111 ARTICLE 66. NOTICE OF TAXABLE POSSESSORY INTEREST .................................111 ARTICLE 67. SURVIVAL OF OBLIGATIONS .................................................................112 VII SPECIAL CONDITIONS..............................................................................................113 VIII GENERAL REQUIREMENTS......................................................................................117 EXHIBIT “A” CHANGE ORDER FORM.................................................................................. - 1 -

SPECIAL PROVISIONS

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City of Hermosa Beach
BBK (01/2026) -5- 00 11 16–NOTICE INVITING BIDS

I NOTICE INVITING BIDS
NOTICE IS HEREBY GIVEN that the City of Hermosa Beach (“City”) invites and will receive sealed Bids up to but not later than 2:00pm on Thursday, May 21, 2026 at the office of the City of Hermosa Beach, located at 1315 Valley Drive, Hermosa Beach, CA 90254, for the furnishing to City of all labor, equipment, materials, tools, services, transportation, permits, utilities, and all other items necessary for CIP No. 107 Citywide Slurry Seal Project (the “Project”). At said time, Bids will be publicly opened and read aloud at the City Council Chambers. Bids received after said time shall be returned unopened. Bids shall be valid for a period of 90 calendar days after the Bid opening date.

The project includes, but is not limited to, crack sealing of existing pavement and; removal of existing striping and markers, installation of Type II slurry seal with 2.5% Latex and striping and signage at various locations.

Bids must be submitted on the City’s Bid Forms. Bidders may obtain a copy of the Contract Documents from Planet Bids Portal, accessible through the City’s webpage at https://www.hermosabeach.gov/our-government/city-clerk/bids-and-proposals where you must first register as a vendor through our Planet Bids Portal. Contract Documents, plans, and specifications will be available for review on Planet Bids. All relevant materials shall be obtained from the link above.

It is the responsibility of each prospective bidder to download and print all Bid Documents for review and to verify the completeness of Bid Documents before submitting a bid. Any Addenda will be posted on Planet Bids Portal. It is the responsibility of each prospective bidder to check Planet Bids Portal on a daily basis through the close of bids for any applicable addenda or updates. The City does not assume any liability or responsibility based on any defective or incomplete copying, excerpting, scanning, faxing, downloading or printing of the Bid Documents.

Information on Planet Bids Portal may change without notice to prospective bidders. The Contract Documents shall supersede any information posted or transmitted by Planet Bids Portal.

Each Bid shall be accompanied by cash, a certified or cashier’s check, or Bid Bond secured from a surety company satisfactory to the City, the amount of which shall not be less than ten percent (10%) of the submitted Total Bid Price, made payable to City of Hermosa Beach as bid security.

The bid security shall be provided as a guarantee that within ten (10) working days after the City provides the successful bidder the Notice of Award, the successful Bidder will enter into a contract and provide the necessary bonds and certificates of insurance. The bid security will be declared forfeited if the successful Bidder fails to comply within said time. No interest will be paid on funds deposited with City.

A MANDATORY Pre-Bid Conference is scheduled for 10:30am on Monday, May 11, 2026 to review the Project's existing conditions at N/E corner of Hermosa Ave. and 2nd St.

Representatives of the City and consulting engineers, if any, will be present. Questions asked by Bidders at the Pre-Bid Conference not specifically addressed within the Contract Documents shall be answered in writing, and shall be sent to all Bidders present at the Pre-Bid Conference. Bids will not be accepted from any bidder who did not attend the mandatory Pre-Bid Conference.

Please submit any questions related to this bid on PlanetBids portal no later than 2pm on Thursday, May 14, 2026.

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City of Hermosa Beach
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The successful Bidder will be required to furnish a Faithful Performance Bond and a Labor and Material Payment Bond each in an amount equal to one hundred percent (100%) of the Contract Price. Each bond shall be in the forms set forth herein, shall be secured from a surety company that meets all State of California bonding requirements, as defined in California Code of Civil Procedure Section 995.120, and that is a California admitted surety insurer.

Pursuant to Section 22300 of the Public Contract Code of the State of California, the successful Bidder may substitute certain securities for funds withheld by City to ensure its performance under the contract.

Pursuant to Labor Code Section 1773, City has obtained the prevailing rate of per diem wages and the prevailing wage rate for holiday and overtime work applicable in Los Angeles County from the State of California, Department of Industrial Relations for each craft, classification, or type of worker needed to execute this contract. A copy of these prevailing wage rates may be obtained via the internet at: www.dir.ca.gov/dlsr/
In addition, a copy of the prevailing rate of per diem wages is available at the City’s Public Works Department and shall be made available to interested parties upon request. The successful bidder shall post a copy of the prevailing wage rates at each job site. It shall be mandatory upon the Bidder to whom the Contract is awarded, and upon any subcontractors, to comply with all Labor Code provisions, which include but are not limited to the payment of not less than the said specified prevailing wage rates to all workers employed by them in the execution of the Contract, employment of apprentices, hours of labor and debarment of contractors and subcontractors.

Pursuant to Labor Code sections 1725.5 and 1771.1, all contractors and subcontractors that wish to bid on, be listed in a bid proposal, or enter into a contract to perform public work must be registered with the Department of Industrial Relations. No Bid will be accepted nor any contract entered into without proof of the contractor’s and subcontractors’ current registration with the Department of Industrial Relations to perform public work. If awarded a contract, the Bidder and its subcontractors, of any tier, shall maintain active registration with the Department of Industrial Relations for the duration of the Project. Notwithstanding the foregoing, the contractor registration requirements mandated by Labor Code Sections 1725.5 and 1771.1 shall not apply to work performed on a public works project that is exempt pursuant to the small project exemption specified in Labor Code Sections 1725.5 and 1771.1.

This Project is subject to compliance monitoring and enforcement by the Department of Industrial Relations. In bidding on this Project, it shall be the Bidder’s sole responsibility to evaluate and include the cost of complying with all labor compliance requirements under this contract and applicable law in its Bid.

The California Air Resources Board (“CARB”) implemented amendments to the In-Use Off-Road Diesel-Fueled Fleets Regulations (“Regulation”) which are effective on January 1, 2024 and apply broadly to all self-propelled off road diesel vehicles 25 horsepower or greater and other forms of equipment used in California. A copy of the Regulation is available at https://ww2.arb.ca.gov/sites/default/files/barcu/regact/2022/off-roaddiesel/appa-1.pdf. Bidders are required to comply with all CARB and Regulation requirements, including, without limitation, all applicable sections of the Regulation, as codified in Title 13 of the California Code of Regulations section 2449 et seq. throughout the term of the Project. Bidders must provide, with their Bid, copies of Bidder’s and all listed subcontractors the most recent, valid Certificate of

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City of Hermosa Beach
BBK (01/2026) -7- 00 11 16–NOTICE INVITING BIDS
Reported Compliance (“CRC”) issued by CARB. Failure to provide valid CRCs as required herein may render the Bid non-responsive.

Unless otherwise provided in the Instructions for Bidders, each Bidder shall be a licensed contractor pursuant to sections 7000 et seq. of the Business and Professions Code in the following classification(s) throughout the time it submits its Bid and for the duration of the contract: State of California Contractors License Class “A”.

Substitution requests shall be made within 35 calendar days after the award of the contract.

Pursuant to Public Contract Code Section 3400(b), the City may make findings designating that certain additional materials, methods or services by specific brand or trade name other than those listed in the Standard Specifications be used for the Project. Such findings, if any, as well as the materials, methods or services and their specific brand or trade names that must be used for the Project may be found in the Special Conditions.

Pursuant to Public Contract Code section 3400(b), if the City has made any findings designating certain materials, products, things, or services by specific brand or trade name, such findings and the materials, products, things, or services and their specific brand or trade names will be set forth in the Special Conditions.

Pursuant to Public Contract Code section 7201, the City has made a determination that the project described herein is substantially complex, and therefore a retention of 5% will be withheld from payment until after the work is complete.

City shall award the contract for the Project to the lowest responsive, responsible Bidder as determined by the City from the total base bid alone. City reserves the right to reject any or all bids or to waive any irregularities or informalities in any bids or in the bidding process.

For further information, contact Project Manager, Magvern By at [email protected] or (310) 318-0257.

END OF NOTICE INVITING BIDS

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City of Hermosa Beach
BBK (01/2026) -8- 00 11 16–NOTICE INVITING BIDS

II INSTRUCTIONS TO BIDDERS
ARTICLE 1. SECURING DOCUMENTS
Bids must be submitted to the City on the Bid Forms which are a part of the Bid Package for the Project. Bid and Contract Documents may be obtained from https://pbsystem.planetbids.com/portal/51313/bo/bo-search as specified in the Notice Inviting Bids. Prospective bidders are encouraged to telephone in advance to determine the availability of Contract Documents. Any charge for the Contract Documents is stated in the Notice Inviting Bids.

The City may also make the Contract Documents available for review at one or more plan rooms, as indicated in the Notice Inviting Bids. Please Note: Prospective Bidders who choose to review the Contract Documents at a plan room must contact the City to obtain the required Contract Documents if they decide to submit a bid for the Project.

Any Addenda will be posted on https://pbsystem.planetbids.com/portal/51313/bo/bo-search.

Failure to acknowledge addenda may make a bid nonresponsive and not eligible for award of the contract.

ARTICLE 2. EXAMINATION OF SITE AND CONTRACT DOCUMENTS
At its own expense and prior to submitting its Bid, each Bidder shall visit the site of the proposed work and fully acquaint itself with the conditions relating to the construction and labor required so that the Bidder may fully understand the work, including but not limited to difficulties and restrictions attending the execution of the work under the contract. Each Bidder shall carefully examine the Drawings, and shall read the Specifications, Contract, and all other documents referenced herein. Each Bidder shall also determine the local conditions which may in any way affect the performance of the work, including local tax structure, contractors’ licensing requirements, availability of required insurance, the prevailing wages and other relevant cost factors, shall familiarize itself with all federal, state and local laws, ordinances, rules, regulations and codes affecting the performance of the work, including the cost of permits and licenses required for the work, and shall make such surveys and investigations, including investigations of subsurface or latent physical conditions at the site or where work is to be performed as may be required. Bidders are responsible for consulting the standards referenced in the Contract. The failure or omission of any Bidder to receive or examine any contract documents, forms, instruments, addenda, or other documents, or to visit the site and acquaint itself with conditions there existing shall in no way relieve any Bidder from any obligation with respect to its Bid or to the contract and no relief for error or omission will be given except as required under State law.

The submission of a Bid shall be taken as conclusive evidence of compliance with this Article.

ARTICLE 3. INTERPRETATION OF DRAWINGS AND DOCUMENTS
Prospective Bidders unclear as to the true meaning of any part of the Drawings, Specifications or other proposed contract documents may submit to the Engineer of the City a written request for interpretation. The prospective Bidder submitting the request is responsible for prompt delivery.

Interpretation of the Drawings, Specifications or other proposed contract documents will be made only by a written addendum duly issued and a copy of such addenda will be mailed or delivered to each prospective Bidder who has purchased a set of Drawings and Specifications. The City will not be responsible for any other explanation or interpretations of the proposed documents. If

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City of Hermosa Beach
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a Prospective Bidders becomes aware of any errors or omissions in any part of the Contract Documents, it is the obligation of the Prospective Bidder to promptly bring it to the attention of the City.

ARTICLE 4. PRE-BID CONFERENCE
A MANDATORY Pre-Bid Conference is scheduled for 10:30pm on Monday, May 11, 2026 to review the Project's existing conditions at N/E corner of Hermosa Ave. and 2nd St..

Representatives of the City and consulting engineers, if any, will be present. Questions asked by Bidders at the Pre-Bid Conference not specifically addressed within the Contract Documents shall be answered in writing, and shall be sent to all Bidders present at the Pre-Bid Conference. Bids will not be accepted from any bidder who did not attend the mandatory Pre-Bid Conference.

ARTICLE 5. ADDENDA
The City reserves the right to revise the Contract Documents prior to the Bid opening date.

Revisions, if any, shall be made by written Addenda. All Addenda issued by the City shall be included in the Bid and made part of the Contract Documents. Pursuant to Public Contract Code Section 4104.5, if the City issues an Addendum which includes material changes to the Project less than 72 hours prior to the deadline for submission of Bids, the City will extend the deadline for submission of Bids. The City may determine, in its sole discretion, whether an Addendum warrants postponement of the Bid submission date. Each prospective Bidder shall provide City a name, address, email address, and facsimile number to which Addenda may be sent, as well as a telephone number by which the City can contact the Bidder. Copies of Addenda will be furnished by email, facsimile, first class mail, express mail or other proper means of delivery without charge to all parties who have obtained a copy of the Contract Documents and provided such current information. Please Note: Bidders are responsible for ensuring that they have received any and all Addenda. To this end, each Bidder should contact the City of Hermosa Beach, Public Works Department to verify that it has received all Addenda issued, if any, prior to the Bid opening. The Bidder shall indicate the Addenda received prior to bidding in the space provided in the Bid Form. Failure to indicate all Addenda may be sufficient cause for rejecting the Bid.

ARTICLE 6. ALTERNATE BIDS
If alternate bid items are called for in the Contract Documents, the time required for completion of the alternate bid items has already been factored into the Contract duration and no additional Contract time will be awarded for any of the alternate bid items. The City may elect to include one or more of the alternate bid items, or to otherwise remove certain work from the Project scope of work. Accordingly, each bidder must ensure that each bid item contains a proportionate share of profit, overhead, and other costs or expenses which will be incurred by the bidder.

ARTICLE 7. COMPLETION OF BID FORMS
Bids shall only be prepared using copies of the Bid Forms which are included in the Contract Documents. The use of substitute Bid Forms other than clear and correct photocopies of those provided by the City will not be permitted. Bids shall be executed by an authorized signatory as described in these Instructions to Bidders. In addition, Bidders shall fill in all blank spaces (including inserting “N/A” where applicable), and initial all interlineations, alterations, or erasures

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City of Hermosa Beach
BBK (01/2026) -10- 00 11 16–NOTICE INVITING BIDS
to the Bid Forms. Bidders shall neither delete, modify, nor supplement the printed matter on the Bid Forms nor make substitutions thereon. USE OF BLACK OR BLUE INK, INDELIBLE PENCIL, OR A TYPEWRITER IS REQUIRED. Deviations in the Bid Forms may result in the Bid being deemed non-responsive.

ARTICLE 8. MODIFICATIONS OF BIDS
Each Bidder shall submit its Bid in strict conformity with the requirements of the Contract Documents. Unauthorized additions, modifications, revisions, conditions, limitations, exclusions or provisions attached to a Bid may render it non-responsive and may cause its rejection. Bidders shall not delete, modify, or supplement the printed matter on the Bid Forms, or make substitutions thereon. Oral, telephonic and electronic modifications will not be considered.

ARTICLE 9. SUBCONTRACTORS
Bidder shall set forth the name, address of the place of business, DIR public works contractor registration number unless exempt pursuant to Labor Code Sections 1725.5 and 1771.1, and contractor license number of each subcontractor who will perform work, labor, furnish materials or render services to the bidder on said contract and each subcontractor licensed by the State of California who, under subcontract to bidder, specially fabricates and installs a portion of the Work described in the Drawings and Specifications in an amount in excess of one half of one percent (0.5%) of the total bid price, and shall indicate the portion of the work to be done by such subcontractor in accordance with Public Contract Code Section 4104.

ARTICLE 10. LICENSING REQUIREMENTS
Pursuant to Business and Professions Code Section 7028.15 and Public Contract Code Section 3300, all bidders must possess proper licenses for performance of this Contract. Subcontractors must possess the appropriate licenses for each specialty subcontracted. Pursuant to Business and Professions Code Section 7028.5, the City shall consider any bid submitted by a contractor not currently licensed in accordance with state law and pursuant to the requirements found in the Contract Documents to be nonresponsive, and the City shall reject the Bid. The City shall have the right to request, and Bidders shall provide within ten (10) calendar days, evidence satisfactory to the City of all valid license(s) currently held by that Bidder and each of the Bidder’s subcontractors, before awarding the Contract.

Notwithstanding anything contained herein, if the Work involves federal funds, the Contractor shall be properly licensed by the time the Contract is awarded, pursuant to the provisions of Public Contract Code section 20103.5.

ARTICLE 11. COMPLIANCE WITH CARB REGULATIONS
The City is a Public Works Awarding Body, as defined under Title 13 California Code of Regulations section 2449(c)(46). Accordingly, Bidders must submit, with their Bids, a valid Certificate of Reported Compliance (“CRC”) for the Bidder’s and its listed subcontractors fleet (including any applicable leased equipment or vehicles) . Bidder must complete and submit the Fleet Compliance Certification, on the form included in the bid package. Failure to provide a valid CRC for the Bidder’s fleet, and for the fleets of all listed subcontractors, or failure to complete the Fleet Compliance Certification, may render the Bid non-responsive.

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City of Hermosa Beach
BBK (01/2026) -11- 00 11 16–NOTICE INVITING BIDS
ARTICLE 12. BID GUARANTEE (BOND)
Each bid shall be accompanied by: (a) cash; (b) a certified or cashier’s check made payable to City of Hermosa Beach; or (c) a Bid Bond secured from a surety company satisfactory to the City, the amount of which shall not be less than ten percent (10%) of the Total Bid Price, made payable to City of Hermosa Beach as bid security. Personal sureties and unregistered surety companies are unacceptable. The surety insurer shall be California admitted surety insurer, as defined in Code of Civil Procedure Section 995.120. The bid security shall be provided as a guarantee that within ten (10) working days after the City provides the successful bidder the Notice of Award, the successful bidder will enter into a contract and provide the necessary bonds and certificates of insurance. The bid security will be declared forfeited if the successful bidder fails to comply within said time, and City may enter into a contract with the next lowest responsive responsible bidder, or may call for new bids. No interest shall be paid on funds deposited with the City. City will return the security accompanying the bids of all unsuccessful bidders no later than 60 calendar days after award of the contract.

ARTICLE 13. IRAN CONTRACTING ACT OF 2010
In accordance with Public Contract Code Section 2200 et seq., the City requires that any person that submits a bid or proposal or otherwise proposes to enter into or renew a contract with the City with respect to goods or services of one million dollars ($1,000,000) or more, certify at the time the bid is submitted or the contract is renewed, that the person is not identified on a list created pursuant to subdivision (b) of Public Contract Code Section 2203 as a person engaging in investment activities in Iran described in subdivision (a) of Public Contract Code Section 2202.5, or as a person described in subdivision (b) of Public Contract Code Section 2202.5, as applicable.

The form of such Iran Contracting Certificate is included with the bid package and must be signed and dated under penalty of perjury.

ARTICLE 14. NONCOLLUSION DECLARATION
Bidders on all public works contracts are required to submit a declaration of noncollusion with their bid. This form is included with the bid package and must be signed and dated under penalty of perjury.

ARTICLE 15. PUBLIC WORKS CONTRACTOR REGISTRATION CERTIFICATION Pursuant to Labor Code sections 1725.5 and 1771.1, all contractors and subcontractors that wish to bid on, be listed in a bid proposal, or enter into a contract to perform public work must be registered with the Department of Industrial Relations. No bid will be accepted nor any contract entered into without proof of the contractor’s and subcontractors’ current registration with the Department of Industrial Relations to perform public work. If awarded a contract, the bidder and its subcontractors, of any tier, shall maintain active registration with the Department of Industrial Relations for the duration of the Project. To this end, Bidder shall sign and submit with its Bid the Public Works Contractor Registration Certification on the form provided, attesting to the facts contained therein. Failure to submit this form may render the bid non-responsive. In addition, each Bidder shall provide the registration number for each listed subcontractor in the space provided in the Designation of Subcontractors form.

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City of Hermosa Beach
BBK (01/2026) -12- 00 11 16–NOTICE INVITING BIDS
ARTICLE 16. BIDDER INFORMATION AND EXPERIENCE FORM
Each Bidder shall complete the questionnaire provided herein and shall submit the questionnaire along with its Bid. Failure to provide all information requested within the questionnaire along with the Bid may cause the bid to be rejected as non-responsive. The City reserves the right to reject any Bid if an investigation of the information submitted does not satisfy the Engineer that the Bidder is qualified to properly carry out the terms of the contract.

ARTICLE 17. WORKERS' COMPENSATION CERTIFICATION
In accordance with the provisions of Labor Code Section 3700, Contractor shall secure the payment of compensation to its employees. Contractor shall sign and file with the City the following certificate prior to performing the work under this Contract:

I am aware of the provisions of Section 3700 of the Labor Code, which require every employer to be insured against liability for workers’ compensation or to undertake self-insurance in accordance with the provisions of that code, and I will comply with such provisions before commencing the performance of the work of this contract.

The form of such Workers' Compensation Certificate is included as part of this document.

ARTICLE 18. SIGNING OF BIDS
All Bids submitted shall be executed by the Bidder or its authorized representative. Bidders may be asked to provide evidence in the form of an authenticated resolution of its Board of Directors or a Power of Attorney evidencing the capacity of the person signing the Bid to bind the Bidder to each Bid and to any Contract arising therefrom.

If a Bidder is a joint venture or partnership, it may be asked to submit an authenticated Power of Attorney executed by each joint venturer or partner appointing and designating one of the joint venturers or partners as a management sponsor to execute the Bid on behalf of Bidder. Only that joint venturer or partner shall execute the Bid. The Power of Attorney shall also: (1) authorize that particular joint venturer or partner to act for and bind Bidder in all matters relating to the Bid; and (2) provide that each venturer or partner shall be jointly and severally liable for any and all of the duties and obligations of Bidder assumed under the Bid and under any Contract arising therefrom. The Bid shall be executed by the designated joint venturer or partner on behalf of the joint venture or partnership in its legal name.

ARTICLE 19. SUBMISSION OF SEALED BIDS
Once the Bid and supporting documents have been completed and signed as set forth herein, they shall be placed, along with the Bid Guarantee and other required materials, in a sealed envelope, addressed and delivered or mailed, postage prepaid, to the Engineering Department of the City before the time and day set for the receipt of bids. The envelope shall bear the title of the work and the name of the bidder. No oral or telephonic bids will be considered. No forms transmitted via the internet, e-mail, facsimile, or any other electronic means will be considered unless specifically authorized by the City as provided herein. Bids received after the time and day set for the receipt of bids shall be returned to the bidder unopened. The envelope shall also contain the following in the lower left-hand corner thereof:

65270.00021\44496819.1
City of Hermosa Beach
BBK (01/2026) -13- 00 11 16–NOTICE INVITING BIDS
Bid of (Bidder’s Name)
for the CIP NO. 107 Citywide Slurry Seal Project
Only where expressly permitted in the Notice Inviting Bids may bidders submit their bids via electronic transmission pursuant to Public Contract Code sections 1600 and 1601. Any acceptable method(s) of electronic transmission shall be stated in the Notice Inviting Bids. City may reject any bid not strictly complying with City’s designated methods for delivery.

ARTICLE 20. OPENING OF BIDS
At the time and place set for the opening and reading of bids, or any time thereafter, each and every bid received prior to the time and day set for the receipt of bids will be publicly opened and read. The City will leave unopened any Bid received after the specified date and time, and any such unopened Bid will be returned to the bidder. It is the bidder’s sole responsibility to ensure that its Bid is received as specified. Bids may be submitted earlier than the date(s) and time(s) indicated.

The public reading of each bid will include the following information:

A. The name and business location of the bidder.

B. The nature and amount of the bid security furnished by bidder.

C. The bid amount.

Bidders or their representatives and other interested persons may be present at the opening of the bids. The City may, in its sole discretion, elect to postpone the opening of the submitted Bids.

The City reserves the right to reject any or all Bids and to waive any informality or irregularity in any Bid.

ARTICLE 21. WITHDRAWAL OF BID
Any bid may be withdrawn either personally or by written request, incurring no penalty, at any time prior to the scheduled closing time for receipt of bids. Requests to withdraw bids shall be worded so as not to reveal the amount of the original bid. Withdrawn bids may be resubmitted until the time and day set for the receipt of bids, provided that resubmitted bids are in conformance with the instructions herein.

Bids may be withdrawn after bid opening only by providing written notice to City within five (5) working days of the bid opening and in compliance with Public Contract Code Section 5100 et seq., or as otherwise may be allowed with the consent of the City.

ARTICLE 22. BIDDERS INTERESTED IN MORE THAN ONE BID
No Bidder shall be allowed to make, file or be interested in more than one bid for the same work unless alternate bids are specifically called for. A person, firm or corporation that has submitted a sub-proposal to a Bidder, or that has quoted prices of materials to a Bidder, is not thereby disqualified from submitting a sub-proposal or quoting prices to other bidders. No person, firm, corporation, or other entity may submit a sub-proposal to a Bidder, or quote prices of materials to

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a Bidder, when also submitting a prime Bid on the same Project.

ARTICLE 23. SUBSTITUTION OF SECURITY
The Contract Documents call for monthly progress payments based upon the percentage of the Work completed. The City will retain a percentage of each progress payment as provided by the Contract Documents. At the request and expense of the successful Bidder, the City will substitute securities for the amount so retained in accordance with Public Contract Code Section 22300.

ARTICLE 24. PREVAILING WAGES
The City has obtained from the Director of the Department of Industrial Relations the general prevailing rate of per diem wages in the locality in which this work is to be performed for each craft or type of worker needed to execute the Contract. These rates are available at the Public Works Department of the City or may be obtained online at http://www.dir.ca.gov. Bidders are advised that a copy of these rates must be posted by the successful Bidder at the job site(s).

ARTICLE 25. DEBARMENT OF CONTRACTORS AND SUBCONTRACTORS In accordance with the provisions of the Labor Code, contractors or subcontractors may not perform work on a public works project with a subcontractor who is ineligible to perform work on a public project pursuant to Labor Code Sections 1777.1 or 1777.7. Any contract on a public works project entered into between a contractor and a debarred subcontractor is void as a matter of law. A debarred subcontractor may not receive any public money for performing work as a subcontractor on a public works contract. Any public money that is paid to a debarred subcontractor by the Contractor for the Project shall be returned to the City. The Contractor shall be responsible for the payment of wages to workers of a debarred subcontractor who has been allowed to work on the Project.

ARTICLE 26. INSURANCE REQUIREMENTS
Prior to commencing work, the successful bidder shall purchase and maintain insurance as set forth in the General Conditions.

ARTICLE 27. PERFORMANCE BOND AND PAYMENT BOND REQUIREMENTS The successful bidder will be required to furnish a Labor and Material Payment Bond and a Faithful Performance Bond each in an amount equal to one hundred percent (100%) of the contract price. Each bond shall be secured from a surety company that meets all State of California bonding requirements, as defined in California Code of Civil Procedure Section 995.120 and is admitted by the State of California. Each bond shall be accompanied, upon the request of City, with all documents required by California Code of Civil Procedure Section 995.660 to the extent required by law. All bonding and insurance requirements shall be completed and submitted to City within ten (10) working days from the date the City provides the successful bidder with the Notice of Award.

ARTICLE 28. SALES AND OTHER APPLICABLE TAXES, PERMITS, LICENSES AND FEES Contractor and its subcontractors performing work under this Contract will be required to pay California sales tax and other applicable taxes, and to pay for permits, licenses and fees required

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by the agencies with authority in the jurisdiction in which the Work will be located, unless otherwise expressly provided by the Contract Documents.

ARTICLE 29. PERMIT AND INSPECTION FEE ALLOWANCE
Notwithstanding anything contained herein, the Bid Form contains an allowance for the Contractor’s cost of acquiring traffic control permits and for construction inspection fees that may be charged to the Contractor by the Agency of Jurisdiction. The allowance is included within the Bid Form to eliminate the need by bidders to research or estimate the costs of traffic control permits and construction inspection fees prior to submitting a bid. The allowance is specifically intended to account for the costs of traffic control permits and construction inspection fees charged by the local Agency of Jurisdiction only. No other costs payable by Contractor to the Agency of Jurisdiction are included within the allowance.

ARTICLE 30. FILING OF BID PROTESTS
Bidders may file a “protest” of a Bid with the City’s City Manager. In order for a Bidder’s protest to be considered valid, the protest must:

A. Be filed in writing within five (5) calendar days after the bid opening date; B. Clearly identify the specific irregularity or accusation; C. Clearly identify the specific City staff determination or recommendation being protested; D. Specify in detail the grounds for protest and the facts supporting the protest; and E. Include all relevant, supporting documentation with the protest at time of filing.

If the protest does not comply with each of these requirements, the City may reject the protest without further review.

If the protest is timely and complies with the above requirements, the City’s City Manager, or other designated City staff member, shall review the protest, any response from the challenged Bidder(s), and all other relevant information. The City Manager will provide a written decision to the protestor.

The procedure and time limits set forth in this Article are mandatory and are the sole and exclusive remedy in the event of a Bid protest. Failure to comply with these procedures shall constitute a failure to exhaust administrative remedies and a waiver of any right to further pursue the Bid protest, including filing a Government Code Claim or legal proceedings.

ARTICLE 31. BASIS OF AWARD; BALANCED BID
The City shall award the Contract to the lowest responsible Bidder submitting a responsive Bid.

The lowest Bid will be determined on the basis of the Total Bid Price.

The City may reject any Bid which, in its opinion when compared to other Bids received or to the City’s internal estimates, does not accurately reflect the cost to perform the Work. The City may reject as non-responsive any Bid which unevenly weights or allocates costs, including but not limited to overhead and profit to one or more particular bid items.

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ARTICLE 32. AWARD PROCESS
Once all Bids are opened and reviewed to determine the lowest responsive and responsible Bidder, the City may award the contract. The apparent successful Bidder should begin to prepare the following documents: (1) the Performance Bond; (2) the Payment Bond; and (3) the required insurance certificates and endorsements. Once the City notifies the Bidder of the award, the Bidder will have ten (10) working days from the date of this notification to execute the Contract and supply the City with all of the required documents and certifications. Regardless of whether the Bidder supplies the required documents and certifications in a timely manner, the Contract time will begin to run twenty (20) working days from the date of the notification. Once the City receives all of the properly drafted and executed documents and certifications from the Bidder, the City shall issue a Notice to Proceed to that Bidder.

ARTICLE 33. EXECUTION OF CONTRACT
As required herein the Bidder to whom an award is made shall execute the Contract in the amount determined by the Contract Documents. The City may require appropriate evidence that the persons executing the Contract are duly empowered to do so. The Contract and bond forms to be executed by the successful Bidder are included within these Specifications and shall not be detached.

ARTICLE 34. QUESTIONS
Questions regarding this Notice Inviting Bids may be directed to Magvern By, Project Manager, AT (310) 318-0257 or email at [email protected] . No other members of the City’s staff or governing body should be contacted about this procurement during the bidding process. Any and all inquiries and comments regarding this Bid must be communicated in writing, unless otherwise instructed by the City. The City may, in its sole discretion, disqualify any Bidder who engages in any prohibited communications.

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II BID FORMS
Bid
Bids will be received at the City of Hermosa Beach, 1315 Valley Dr., Hermosa Beach, CA 90254, until 2:00 p.m. on Thursday, May 21, 2026.

NAME OF BIDDER: ______________________________________________ The undersigned hereby declare that we have carefully examined the location of the proposed Work, and have read and examined the Contract Documents, including all plans, specifications, and all addenda, if any for the following Project:

CIP NO. 107
Citywide Slurry Seal Project
We hereby propose to furnish all labor, materials, equipment, tools, transportation, and services, and to discharge all duties and obligations necessary and required to perform and complete the Project, as described and in strict conformity with the Drawings, and these Specifications for TOTAL BID PRICE indicated herein.

The undersigned acknowledges receipt, understanding, and full consideration of the following addenda to the Contract Documents:

Addenda No. ________________________________________________

1. Attached is the required Bid Guarantee in the amount of not less than 10% of the Total Bid Price.

2. Attached is the completed Designation of Subcontractors form.

3. Attached is the fully executed Noncollusion Declaration form.

4. Attached is the completed Iran Contracting Act Certification form.

5. Attached is the completed Fleet Compliance Certification form.

6. Attached is the completed Public Works Contractor Registration Certification form.

7. Attached is the completed Contractor’s Certificate Regarding Workers’ Compensation form.

8. Attached is the completed Bidder Information and Experience form.

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A. BID SCHEDULE
Alternate Bid item
The costs for any Work shown or required in the Contract Documents, but not specifically identified as a line item are to be included in the related line items and no additional compensation shall be due to Contractor for the performance of the Work.

In case of discrepancy between the Unit Price and the Item Cost set forth for a unit basis item, the unit price shall prevail and shall be utilized as the basis for determining the lowest responsive, responsible Bidder. However, if the amount set forth as a unit price is ambiguous, unintelligible or uncertain for any cause, or is omitted, or is the same amount as the entry in the “Item Cost” column, then the amount set forth in the “Item Cost” column for the item shall prevail and shall be divided by the estimated quantity for the item and the price thus obtained shall be the Unit Price.

For purposes of evaluating Bids, the City will correct any apparent errors in the extension of unit prices and any apparent errors in the addition of lump sum and extended prices.

The estimated quantities for Unit Price items are for purposes of comparing Bids only and the City makes no representation that the actual quantities of work performed will not vary from the estimates. Final payment shall be determined by the Engineer from measured quantities of work performed based upon the Unit Price.

Item
No.

Estimated
Quantity Unit Description of Work SpecificationReference Unit
Price Total
1 1 LS
Mobilization and Demobilization
(5% max. of total bid schedule
cost)
7-3.4
2 1 LS Traffic Control 600, 601
3 170 TON Type II Slurry Seal w/ 2.5%
Latex 200, 302, 400
4 1 LS Crack Seal, including Pothole
Repair on Slurry Seal Streets 302
5 1 LS
Crack Seal, including Pothole
Repair on Hermosa Ave (See
Plan Sheet 11)
302
6 1 LS Striping and Signage 214, 314
7 1 LS
Clark Field – Type II Slurry seal
w/ 2.5% Latex and Crack Seal
including Pothhole Repair (See
Plan Sheet 13, 5,600 SF ±)
200, 302, 400
1 2,000 SF
Mastic Pavement Repair at
Permeable Gutter on Hermosa
Ave., 12” Width
302

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B. TOTAL BID PRICE:

TOTAL BID PRICE BASED ON BID SCHEDULE TOTAL OF UNIT PRICES FOR CIP NO. 107, Citywide Slurry Seal Project
$
Total Bid Price in Numbers
$
Total Bid Price in Written Form
In case of discrepancy between the written price and the numerical price, the written price shall prevail.

The undersigned agrees that this Bid Form constitutes a firm offer to the City which cannot be withdrawn for the number of calendar days indicated in the Notice Inviting Bids from and after the Bid opening, or until a Contract for the Work is fully executed by the City and a third party, whichever is earlier.

The successful bidder hereby agrees to sign the contract and furnish the necessary bonds and certificates of insurance within ten (10) working days after the City provides the successful bidder with the Notice of Award.

Upon receipt of the signed contract and other required documents, the contract will be executed by the City, after which the City will prepare a letter giving Contractor Notice to Proceed. The official starting date shall be the date of the Notice to Proceed, unless otherwise specified. The undersigned agrees to begin the Work within ten (10) working days of the date of the Notice to Proceed, unless otherwise specified.

The undersigned has examined the location of the proposed work and is familiar with the Drawings and Specifications and the local conditions at the place where work is to be done.

If awarded the contract, the undersigned agrees that there shall be paid by the undersigned and by all subcontractors to all laborers, workers and mechanics employed in the execution of such contract no less than the prevailing wage rate within Los Angeles County for each craft, classification, or type of worker needed to complete the Work contemplated by this contract as established by the Director of the Department of Industrial Relations. A copy of the prevailing rate of per diem wages are on file at the City’s Administration Office and shall be made available to interested parties upon request.

Enclosed find cash, bidder’s bond, or cashier’s or certified check No. _________ from the _______________ Bank in the amount of ________________________________, which is not less than ten percent (10%) of this bid, payable to City of Hermosa Beach as bid security and

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which is given as a guarantee that the undersigned will enter into a contract and provide the necessary bonds and certificates of insurance if awarded the Work.

The bidder furthermore agrees that in case of bidder’s default in executing said contract and furnishing required bonds and certificates of insurance, the cash, bidder’s bond, or cashier’s or certified check accompanying this proposal and the money payable thereon shall become and shall remain the property of the City of Hermosa Beach.

Bidder is an individual ______, or corporation ______, or partnership ______, organized under the laws of the State of _______________________________.

Bidder confirms license(s) required by California State Contractor’s License Law for the performance of the subject project are in full effect and proper order. The following are the Bidder’s applicable license number(s), with their expiration date(s) and class of license(s):

If the Bidder is a joint venture, each member of the joint venture must include the required licensing information.

Sureties that will furnish the Faithful Performance Bond and the Labor and Material Payment Bond, in the form specified herein, in an amount equal to one hundred percent (100%) of the contract price within ten (10) working days from the date the City provides the successful bidder the Notice of Award. Sureties must meet all of the State of California bonding requirements, as defined in California Code of Civil Procedure Section 995.120 and must be authorized by the State of California.

The insurance company or companies to provide the insurance required in the contract documents must have a Financial Strength Rating of not less than “A-” and a Financial Size Category of not less than “Class VII” according to the latest Best Key Rating Guide. At the sole discretion of the City, the City may waive the Financial Strength Rating and the Financial Size Category classifications for Workers’ Compensation insurance. (signatures continued on next page)

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I hereby certify under penalty of perjury under the laws of the State of California that all of the information submitted in connection with this Bid and all of the representations made herein are true and correct.

Executed at _________________________, on this ____ day of __________, _____. (Bidders Name – Print or Type)
________________________________
(Name and Title)
(Corporate Seal)
________________________________
(Signature)
Names of individual members of firm or names and titles of all officers of corporation and their addresses are listed below:

Name Title
Complete Address
Phone FAX
Name Title
Complete Address
Phone FAX
Name Title
Complete Address
Phone FAX
Name Title
Complete Address
Phone FAX

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Bid Bond
[Note: Not required when other form of Bidder’s Security, e.g. cash, certified check or cashier’s check, accompanies bid.]
The makers of this bond are, _____________________________________________, as Principal, and ______________________________________________________, as Surety and are held and firmly bound unto the City of Hermosa Beach, hereinafter called the City, in the penal sum of TEN PERCENT (10%) OF THE TOTAL BID PRICE of the Principal submitted to City for the work described below, for the payment of which sum in lawful money of the United States, well and truly to be made, we bind ourselves, our heirs, executors, administrators, successors and assigns, jointly and severally, firmly by these presents.

THE CONDITION OF THIS OBLIGATION IS SUCH that whereas the Principal has submitted the accompanying bid dated _____________, 20 ____, for CIP No.107 Citywide Slurry Seal Project.

If the Principal does not withdraw its Bid within the time specified in the Contract Documents; and if the Principal is awarded the Contract and provides all documents to the City as required by the Contract Documents; then this obligation shall be null and void. Otherwise, this bond will remain in full force and effect.

Surety, for value received, hereby stipulates and agrees that no change, extension of time, alteration or addition to the terms of the Contract Documents shall in affect its obligation under this bond, and Surety does hereby waive notice of any such changes.

In the event a lawsuit is brought upon this bond by the City and judgment is recovered, the Surety shall pay all litigation expenses incurred by the City in such suit, including reasonable attorneys’ fees, court costs, expert witness fees and expenses.

By their signatures hereunder, Surety and Principal hereby confirm under penalty of perjury that surety is an admitted surety insurer authorized to do business in the State of California.

IN WITNESS WHEREOF, the above-bound parties have executed this instrument under their several seals this _______ day of ________________, 20____, the name and corporate seal of each corporation.
(Corporate Seal)
Contractor/ Principal
By
Title
(Corporate Seal) Surety
By
Attorney-in-Fact
(Attach Attorney-in-Fact Certificate) Title

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Notary Acknowledgment
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

STATE OF CALIFORNIA
COUNTY OF ______________
On , 20___, before me, _______________________________, Notary Public, personally appeared , who proved to me on the basis of satisfactory Name(s) of Signer(s)
evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature of Notary Public

OPTIONAL
Though the information below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent removal and reattachment of this form to another document.

CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT Individual
Corporate Officer
Title(s) Title or Type of Document
Partner(s) Limited
General Number of Pages
Attorney-In-Fact
Trustee(s)
Guardian/Conservator Date of Document
Other:

Signer is representing:

Name Of Person(s) Or Entity(ies)
Signer(s) Other Than Named Above
NOTE: This acknowledgment is to be completed for Contractor/Principal.

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Notary Acknowledgment
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

STATE OF CALIFORNIA
COUNTY OF ______________
On , 20___, before me, _______________________________, Notary Public, personally appeared , who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature of Notary Public

OPTIONAL
Though the information below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent removal and reattachment of this form to another document.

CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT Individual
Corporate Officer
Title(s) Title or Type of Document
Partner(s) Limited
General Number of Pages
Attorney-In-Fact
Trustee(s)
Guardian/Conservator Date of Document
Other:

Signer is representing:

Name Of Person(s) Or Entity(ies)
Signer(s) Other Than Named Above
NOTE: This acknowledgment is to be completed for the Attorney-in-Fact. The Power-of-Attorney to local representatives of the bonding company must also be attached.

END OF BID BOND