2016-BGF064 V2A, LLC AGREEMENT FOR PROFESSIONAL SERVICES APPEAR
ASPARTYOF THEFIRSTPART:TheGOVERNMENTDEVELOPMENT
BANKFORPUERTORICO,apubliccorporationoftheCommonwealthof Puerto
Rico,createdbyActNo.17,enactedonSeptember 23,1948,asamended ("Act
IT),herein represented byits President MelbaAcostaFebo,oflegal age
and resident ofSan Juan, Puerto Rico, hereinafter referred to as
the "BANK". I I AS PARTY OF THE SECOND PART: V2A,LLC,a limited
liability company
organizedunderthelawsoftheCommonwealthofPuertoRico,withprincipal
offices in San Juan, Puerto Rico, represented herein by its
Director, Mr. Rene Yamin, of I Ilegal age, married and a resident
of San Juan, Puerto Rico, hereinafter referred to as the WITNESSETH
I WHEREAS, pursuant to Executive Order 2015-022 Governor Alejandro
Garcia Padilla created the Working Group for the Fiscal and
Economic RecoveryofPuerto
Rico("WorkingGroup"),andgrantedtheGovernmentDevelopmentBankfor
PuertoRicotheauthoritytocontractontheWorking Group'sbehalfanyandall
technicalandconsultingservicestoassisttheWorkingGroupindeveloping,
composing and drafting a Fiscal and Economic Adjustment Plan for
Puerto Rico; WHEREAS, the BANK, byvirtue ofthe powers conferred to
it under Act 17, has the authority toengage professional,technical
and consulting services that are necessary and convenient to the
activities, programs, and operations ofthe BANK. 2 NOW,THEREFORE,
the BANKand the CONSULTANT agree to enter into this Agreement under
the following: TERMS AND CONDITIONS
FIRST:TheBANKengagestheCONSULTANTtoprovideprofessional services
tosupporttheWorkingGroup fortheFiscalandEconomicRecoveryof
PuertoRicoandtheBANKinthedevelopmentofadraftfiscal adjustmentand
economicgrowthplan,assetforthintheProposaldatedJuly9,2015(the
"Proposal"),and the CONSULTANT agrees to provide these
services.Copy ofthe Proposal is attached hereto and made a part
hereofas Appendix A.Ifany partof
AppendixAisfoundtocontradictorbeinconsistent withanyprovisionofthe
TermsandConditionssetforthherein,suchTermsandConditionsshalltake
precedence over Appendix A and govern the matter in question.
SECOND:This Agreement shall be in effect from the date ofits
execution until October 13,2015, provided that the expiration date
may be extended byamendment executed in writing by both parties.
Notwithstanding any provision to the contrary in this Agreement,
the BANK shall have theright toterminate this Agreement byproviding
the CONSULTANT
thirty(30)days'noticebyregisteredmail,returnreceiptrequested,orovernight
express mail.Ifnotice is given, this Agreement shall terminate upon
the expiration of
thirty(30)daysandtheBANKshallbeobligatedtopayallfeesandexpenses
incurred up to the day ofeffective termination, in accordance with
the terms ofthis Agreement. 4 expenses.Ifthe BANKrequires
additional services beyondthe scope ofworkofthis Agreement or
additional work is required to complete the services that are part
of the scope ofwork, the CONSULTANT and the BANKwill agree
additional compensation and/ortimefortheseservices.Insuch
event,theAgreementshall beamendedto reflect these changes.
FOURTH:TheCONSULTANT'S areaof expertise isin projectmanagement
matters.The CONSULTANT'S personnel will beassigned as needed to
complete the tasks in an efficient manner, taking into
consideration that theBANKhas an urgent need to complete the
services to be rendered hereunder.The BANK will be responsible
forobtaining itsownprofessionaladviceonlegal,accounting,
taxation,andother specialist matters outside the CONSULTANT'S area
ofexpertise.Tothe extent such specialist advisors are retained in
connection with this Agreement or matters arising in connection
with the services provided pursuant to this Agreement, either by
the BANK or bythe CONSULTANT at the BANK'Sinstruction and written
consent, the cost of such specialist advice will be reimbursable
bythe BANKto the CONSULTANT and it shall require the prior
acknowledgment and execution by the parties ofan Addendum to this
Agreement.The CONSULTANT shall not subcontract the services under
this
Agreement,orcontractthird-partyexpertsorotherpersonstorendertheservices
under this Agreement, without prior written authorization from the
BANK.A request to hire a subcontractor shall speclfy the issues in
which the subcontractor would take part.Theprofessional fees earned
bythese persons will bededucted from the total
maximumamountthattheCONSULTANTcanreceiveunderthetermsofthis 5
Agreement.TheconfidentialitycovenantssetforthintheTENTHClauseofthis
Agreement and the other requirements established in the
TWENTY-THIRD Clause of this Agreement shall apply to these persons.
FIFTH:[THIS SPACE WAS INTENIONALLY LEFT BLANK] SIXTH:TheBANKwill
reimburse the CONSULTANT for expenses directly related to the
services rendered under this Agreement and not considered part
ofthe usualoverhead ofa professional office, foritems such as
travelandlodging,long distance telephone tails, faxandother
telecommunication charges,filing fees,taxi fares, printing,
delivery expenses, including services such as overnight mail,
courier and messenger charges. Any expense for which a
reimbursement is requested, shall be reasonable and
necessary,andanyextraordinaryexpenses shallbeauthorized
inwritingandin
advancebytheBANK.TheBANKwillnotreimburseexpenseswhichdonot
complywiththisprovision.Undernocircumstances
willexpensesforalcoholic beverages be reimbursed.
Anypetitionforreimbursementofexpenses mustbeaccompaniedbythe
corresponding invoice and receipt and shall specify the relation
ofthe expense to the services
rendered.Allreimbursementsshallbeforactualexpenses incurredand
shall be billed at cost.The total amount invoiced as expenses
during the term ofthis Agreement shall not exceed NINETEEN THOUSAND
FIVE HUNDRED DOLARS ($19,500.00) as established in the THIRD
Clause.
CONSULTANTseeksreimbursement,asrequiredundertheSIXTHClauseof this
Agreement. Ifsuch required receipts are not provided with the
invoice, the BANK shall not honor the amounts presented and shall
not pay the same. The BANKwill not honor invoices submitted after
one hundred twenty (120) days ofservices having been rendered.The
CONSULTANT accepts andagrees to this requirement, and understands
that ifit does not comply accordingly, it waives its right to
payment for services rendered.
TheBANKreservestherighttoreviewtheinvoicesandiftheyarein compliance
with the requirements set forth in this Agreement,it
willproceedwith payment.
Invoicesmustalsoincludeawrittencertificationstatingthatnoofficeror
employee ofthe BANK, its subsidiaries or affiliates,will derive or
obtain any benefit or profit ofany kind from this Agreement, with
the acknowledgment that invoices which do not include this
certification will not be paid.This certification must read as
follows: "Wecertifyunderpenaltyofnullitythatnopublicservantofthe
GovernmentDevelopmentBankforPuertoRico,itssubsidiariesor
affiliates, will derive or obtain any benefit or profit ofany kind
from the contractualrelationshipwhichisthebasisofthisinvoice.Ifsuch
benefit or profit exists, the required waiver has been obtained
prior to entering into the Agreement.The only consideration to be
received in exchangeforthedeliveryofgoodsorforservicesprovidedisthe
agreed-uponpricethathasbeennegotiatedwithanauthorized
representative ofthe Bank.The total amount shown on this invoice is
true and correct.The services have been rendered, and no payment
has been received." All invoices shall be signed and mailed or
physically delivered to the attention of: POSTAL ADDRESSPHYSICAL
ADDRESS Government Development BankGovernment Development Bank
PREINTERVENTIONPREINTERVENTION PO Box 42001De Diego Avenue No. 100
San Juan, PR00940-2001Roberto Shchez Vilella Government Center
Central Building Floor P Santurce, PR00907-2345 TheCONSULTANT
agrees tosubmit checking account transferdata tothe BANK in order
to facilitate future payments by means ofelectronic transfers.
EIGHTH: TheBANKcertifies thatalldisbursements totheCONSULTANT
underthisAgreementshallbemadewithinfortyfive(45) daysofreceiptofthe
correspondinginvoice-providedthatsuchinvoice,andanyrequestfor
reimbursement ofexpenses, is detailed andsubmitted as
specifiedabove in clause SEVENTH - and drawn from operating bank
accounts opened at the BANKfor such purpose. NINTH:The BANKwill
provide, or will cause others to provide, all relevant \
information,documentationanddatareasonablynecessarytoenablethe
CONSULTANT to fulfill its obligations under this Agreement.Ifthe
BANKdoes not provide,ordoes not cause to beprovided,the required
information, documentation and data, the CONSULTANT shall send a
notice in writing to the BANK explaining the situation in order to
give the BANK the opportunity to correct it. TENTH:The CONSULTANT
acknowledges the proprietary and confidential natureofallinternal,
non-public,information systems, andfinancial andbusiness
information relating to the BANK,its subsidiary corporations and
affiliates, as well 9 as to the Commonwealth ofPuerto Rico, its
agencies, corporations or municipalities
noworhereafterprovidedtotheCONSULTANTinconnectionwiththe
CONSULTANT'S engagement by the BANK under this Agreement.
TheBANKwillfurnish orarrange tohave furnished to the CONSULTANT
suchinformation,documentationanddataastheCONSULTANTbelieves
appropriate in connection with the services being rendered under
this Agreement (all such information, documentation and data so
furnished being the "Materials").The BANK(a) recognizes and
acknowledges that the CONSULTANT: (i) willrelyon
theMaterialsandother publiclyavailable information in fulfilling
the terms ofits engagement under this Agreement without any
obligation to independently verify the same, (ii) does not assume
responsibility for the accuracy or completeness ofthe Materials or
such other information, (iii) has no obligation to undertake an
independent evaluation or appraisal ofany assets or liabilities
ofthe BANK or any other person, (iv)
hasnoobligationtoinvestigatetheaccuracyorcompleteness ofthe
Materials, and (v) withrespecttoanyfinancial forecasts(including
costs,savingsand synergies)thatmaybefurnishedtoordiscussedwiththe
CONSULTANT bythe BANKorits agents, willassume that they
havebeenreasonably preparedandreflectthebestthen-currently
available estimates and judgment ofthe BANK, 10 and(b) consents
toeach ofthe itemsspecified in clause(a) ofthis sentence.
TheMaterialswillnotbeauditedbytheCONSULTANTand,accordingly,the
CONSULTANT will express no opinion thereon. The BANKfurther agrees
to notify the CONSULTANT promptly ofany material change in any
Materials provided by the BANK. TheBANKrepresents thatitwillmakeits
reasonable bestefforts to ensure that the Materials and any other
information or documents furnished by or on behalf ofthe BANK to
the CONSULTANT or third parties will be true, complete and correct
in all material respects. Materials shall not be considered
confidential to the extent that: (a)
theyareorbecomepubliclyavailablethroughasourceotherthanthe
CONSULTANT; (b) they were known to the CONSULTANT (other than in
connection with the performanceofitsduties
underthisAgreement)atthetimesuchMaterialswere furnished to the
CONSULTANT; (c)theyareindependentlydevelopedbytheCONSULTANTwithout
reference to other Materials; (d) they are subsequently learned
from a third party that does not impose an obligation
ofconfidentiality upon the CONSULTANT;
(e)theyarerequiredtobedisclosedpursuanttoapplicableprofessional
standards or law or regulation, government authority, duly
authorized subpoena or court order or directive, but only to the
extent the BANK, wherever practicable and 11
permissible,hasbeeninformedandhashadanopportunitytodisputesuch
requirement; or (f) they are approved for disclosure by prior
consent ofthe BANK. The obligations ofthe CONSULTANT under the
immediately preceding two sentences shall terminate upon the second
anniversary following the earlier of(i) the completion ofthe work
contemplated underthis Agreement,or(ii) the termination ofthis
Agreement; provided that such obligations shall remain in effect
for as long as the BANKshall berequired to treat any such Materials
as confidential, pursuant to its enabling act, and/ or any other
applicable law. The CONSULTANT shall not make public or disclose,
nor copy, reproduce or distribute at anytimetheMaterials to
thirdparties withouttheBANK'Sprevious written consent. The
CONSULTANT may divulge such Materials only to the persons who need
to know the information contained therein to fulfill the purposes
ofthis Agreement provided that such persons(i) shall have been
advised ofthe confidential nature of \ such information and the
CONSULTANT shall direct them, and they shall agree, to
treatasconfidentialsuchinformationandtoreturnallmaterialstothe
CONSULTANTuponrequest;and(ii)ineachcase,suchpersonisboundby
obligations ofconfidentiality and non-use consistent with and at
least as stringent as those set forth in thisAgreement.Inanyevent,
the CONSULTANT shall befully liable, in law and in equity, for any
breach by any such persons ofthe confidentiality obligations
contained herein. 12
IntheeventthattheCONSULTANToranyofitsemployees,agentsor
subcontractorsarerequestedpursuantto,orrequiredby,applicablelawor
regulation or by legal process to disclose any information
contained in the Materials,
theCONSULTANTagreestoprovidetotheBANKwithpromptnoticeofsuch
request(s) orrequirement(s)
toenabletheBANKto,atitssoleexpense,seekan
appropriateprotectiveorder,waivecompliancewiththeprovisionsofthis
Agreement ortakeotherappropriate action. TheCONSULTANT agrees to
useits reasonableefforts toassisttheBANKinobtainingsuch
aprotectiveorder,at the BANK'Ssoleexpense.If,in
theabsenceofaprotectiveorderorthereceiptofa
waiverhereunder,theCONSULTANToranyofitsemployees,agentsor
subcontractorsisnonetheless,inthewrittenopinionofcounselforthe
CONSULTANT,compelledtodisclosetheMaterials,theCONSULTANTorsuch
employees, agents or subcontractors, after written notice to the
BANK,to the extent not prohibited byapplicable law, regulation or
legal process, may disclose only such
MaterialsthattheCONSULTANToritsemployees,agentsorsubcontractorsare
compelled to disclose.
InconnectionwiththeservicesprovidedunderthisAgreement,the
CONSULTANTwillfurnishtheBANKwithanyreports,analysesorothersuch
materials as the BANKmayrequest, which shall at all times bethe
propertyofthe BANK. The parties acknowledge that the CONSULTANT may
develop for itself, or forothers,problemsolving
approaches,frameworks orothertoolsandprocesses 13 developed for the
services provided hereunder, and such approaches, frameworks, tools
and/or processes shall be held in strict confidence by the
CONSULTANT. TheCONSULTANT willpromptly,uponthewritten
requestoftheBANK, deliver to the BANKthe materials, andall
work-product, working papers,reports, analyses and all documents
related to the work conducted hereunder and shall retain
acopythereof,providedthatanysuch copyand/orinformationretainedbythe
CONSULTANT will besubject to the confidentiality provisions and
non-disclosure covenants set forth in this clause TENTH.The
CONSULTANT shall not invoice the time spent to gather and deliver
such information, as it is understood that this is an
administrative obligation complementary to the services rendered
hereunder. This provision shall survive the termination or
expiration ofthis Agreement.
ELEVENTH:TheBANKandtheCONSULTANTagreethatthe
CONSULTANT'Sstatushereunder,andthestatusofanyagents,employeesand
subcontractors engagedbytheCONSULTANT,shallbethatofanindependent
contractoronlyandnotthatofanemployeeoragentoftheBANK.The CONSULTANT
shall not have any power or right to enter into agreements on
behalf ofthe BANK.
TWELFTH:TheCONSULTANTacknowledgesthatinexecutingits
professionalservicespursuanttothisAgreementithastheobligationtoexhibit
completeloyaltytowardstheBANK,includinghavingnoadverseinteresttothis
government entity.Adverse interest includes representing clients
who haveormay have an interest contrary to the BANK'S in the
subject matter of this Agreement.This 14 duty includes the
continued obligation to disclose to the BANKall circumstances ofits
relationships with clients and third persons,and any interest that
could influence the BANK when executing the Agreement or while it
is in effect.
TheCONSULTANTrepresentsconflictinginterestswhen,onbehalfofone
client it must support that which it is its duty to oppose to
comply with its obligations
withanotherprevious,presentorpotentialclient.Also,itrepresentsconflicting
interests when its conduct is described as such in the standards
ofethics applicable to its profession or industry, or in Puerto
Rico'slaws and regulations.The conduct herein described byone ofits
directors, partners or employees shall constitute a violation of
this prohibition.The CONSULTANT shall avoid even the appearance of
the existence ofconflicting interests. The CONSULTANT acknowledges
the power of the President ofthe BANKto oversee the enforcement
ofthe prohibitions herein established.Ifthe President of the
BANKdeterminestheexistenceortheemergenceofadverseinterestswiththe
CONSULTANT,sheshallinformsuchfindingsinwritingandherintentionsto
terminatethisAgreementwithinathirty(30) dayterm.Withinsuchterm,the
CONSULTANT can request a meeting with the President ofthe BANK to
present its arguments regarding thealleged conflict
ofinterest,which shall begrantedat the
President'ssolediscretion.Ifsuch
meetingisnotrequestedwithinthespecified
term,orifthecontroversyisnotsettledsatisfactorilyduringthemeeting,this
Agreement shall berescindedat theendofsaidthirty(30)
dayperiod;provided, however, that, at the BANK'S discretion, the
President may grant the CONSULTANT
($1,000,000.00).TheCONSULTANTagreestosubmittotheBANKappropriate
certification orproofofinsurance from its insurancecompany priorto
issuing the firstpaymentforservices
rendered.Thecertificationprovidedmustidentrfythe
BANKasAdditionalInsured,provideHoldHarmlessAgreementClauseand
include the following cancellation notice: CANCELLATIONCLAUSE: I t
isunderstoodandagreedthati n theeventof cancellation of this
policyat the request of the insurance company, sixfy (60) days
writtennoticeshallbegzventotheabovementionedadditionalinsured,
GOVERNMENT DEVELOPMENT BANK FOR PUERTO RICO.However, it is
agreedthat if cancellation is dueto non-paymentof premium,ten (10)
days written notice will be given.
SIXTEENTH:TheBANKshallindemnifyandholdharmlessthe CONSULTANT and
its present and former partners, principals and employees for any
liability, damages, fees,expenses andcosts(including defense costs)
associated with anythird-partyclaim arising fromorrelating to(i)
misrepresentations made bythe BANK or any of its personnel or
agents, or (ii) false or incomplete information provided to the
CONSULTANT in connection with the services required to be performed
under this Agreement.The provisions ofthis paragraph shall apply
regardless of the nature ofany claim asserted (including but not
limited to contract, statute, tort, strict liability or any form
ofnegligence, whether of the BANK, the CONSULTANT, or others,
except a for the CONSULTANTS gross negligence or willful misconduct
(as determined to be contrary to any applicable law bya court
ofcompetent jurisdiction)).Such terms shall also continue to apply
after any termination of this Agreement and during any dispute
between the parties related to this Agreement.As further
consideration for the services 17 provided, the BANKagrees to the
provisions ofAppendix B,which are incorporated herein in full and
made to form an integral part hereof.
SEVENTEENTH:TheCONSULTANTshallsaveandholdharmlessthe BANK, its
respective officers, agents and employees from any and all claims,
demands, actions or liability ofany nature to the extent such
claims, demands, actions or liability are caused bytheCONSULTANT'S
failure to perform under this Agreement, orthe gross negligence or
willful misconduct ofthe CONSULTANT, its partners, principals or
employees in the performance of this Agreement.
EIGHTEENTH:TheCONSULTANT'Smaterialfailuretocomplywithits
dutiesandresponsibilitiesandtoperformtheservices
assetforthherein,orits
negligenceorunlawfulbehaviorintheperformanceofthisAgreement,shall
constitute abreachoftheAgreementbytheCONSULTANT thatshallentitle
the BANK to terminate this Agreement forthwith and shall, without
limitations as to any
otherrights,releaseanddischargetheBANKfromanyfurtherobligationsand
liabilities hereunder, and without having to comply with the notice
requirements set forth in the SECOND Clause ofthis Agreement.
NINETEENTH:TheCONSULTANTcertifiesandguaranteesthatatthe execution
ofthis Agreement, neither the CONSULTANT, nor any ofits
shareholders, partners, associates, officers, directors, employees
or agents have been convicted, and
thatithasnoknowledgeofanyoftheforegoingbeingthesubjectofany
investigation in either a civil or a criminal procedure in a state
or federal court for
criminalorcivilchargesrelatedtothepublictreasury,thepublictrust,apublic
acknowledged that this certification is an essential condition
ofthis Agreement.Ifthe certification is not correct in its entirety
or in any ofits parts,it shall constitute sufficient
causefortheBANKtoterminate thisAgreementimmediately, without prior
notice, and the CONSULTANT will have to reimburse the BANKany
amount ofmoney received under this Agreement. If
thestatusoftheCONSULTANToranyofitsshareholders,partners,
associates,officers,directors,employeesoragents,withregardstothecharges
previously mentioned should change at any time during the term
ofthe Agreement, the CONSULTANT shall notify the
BANKimmediately.The failure to comply with
thisresponsibilityconstitutesaviolationofthisClause,andshallresultinthe
remedies mentioned previously. TWENTIETH:The CONSULTANT certifies
that it has received a copy ofand agrees tocomply with
ActNo.84-2002,as amended, which establishes the Code of
EthicsforContractors,SuppliersandApplicantsforEconomicIncentivesofthe
ExecutiveAgenciesoftheGovernment oftheCommonwealth ofPuertoRicoand
Puerto Rico Government Ethics Law of2011, Act No. 1-2012, as
amended. TheCONSULTANTalso certifiesandwarrants thatitisin
compliance with Act
No.168-2000,asamended,knownas"ActfortheImprovementofFamily
AssistanceandfortheSupport oftheElderly."IntheeventtheCONSULTANTis
under a court or administrative order directing it to provide
financial support or to fulfill anyobligation underthe
mentionedAct,theCONSULTANTfurther certifies 19
andwarrantsthatitisincompliancewithsaidobligations.Itisexpressly
acknowledged that this certification is an essential condition
ofthis Agreement. If the certification
isnotcorrectinitsentiretyorinanyofitsparts,itshallconstitute
sufficient
causefortheBANKtoterminatetheAgreementimmediately,without prior
notice to the CONSULTANT.
TWENTY-FIRST:Bothpartiesherebydeclarethat,tothebestoftheir
knowledge, nopublicofficeroremployee of theCommonwealth ofPuerto
Rico,or
anyofitsagencies,instrumentalities,publiccorporationsormunicipalitiesor
employee ofthe Legislative or Judicial branches ofthe Government
has any direct or indirect interest in the present Agreement.
TWENTY-SECOND:TheCONSULTANTcertifiesthathedoesnotreceive salary or
any kind ofcompensation for the delivery of regular services
byappointment
inanyagency,instrumentality,publiccorporation,ormunicipalityof the
Commonwealth ofPuerto Rico. TWENTY-THIRD:The CONSULTANT represents
that at the execution ofthis Agreement it has submitted income tax
returns in Puerto Rico during the past five (5) years.TheCONSULTANT
alsorepresents thatitdoes nothaveoutstanding debts regarding its
payment ofincome taxes, realorchattel property taxes,unemployment
insurancepremiums,workers'compensationpaymentsorSocialSecurityfor
chauffeurs in Puerto Rico and the Administration for the Sustenance
ofMinors (known by its Spanish acronym, and hereinafter referred to
as, ASUME). Forthepurposesof
thisAgreement,taxdebtshallmeananydebtthatthe CONSULTANT, or other
parties which the BANKauthorizes the CONSULTANT to subcontract, may
have with the Commonwealth ofPuerto Rico for income taxes, real or
chattelpropertytaxes,includinganyspecialtaxeslevied,licenserights,tax
withholdings forpaymentof salaries and professionalservices, taxes
forpayment of
interest,dividendsandincometoindividuals,corporationsandnon-resident
accounting firms,forpaymentofinterests,dividends
andotherearningsshares to
residents,unemploymentinsurancepremiums,workers'compensationpayments,
Social Security for chauffeurs and ASUME. The CONSULTANT shall
present to the BANK the certifications issued by the Department
oftheTreasury, theDepartmentofLaborandHumanResources,the
MunicipalTaxCollectionCenter(knownbyitsSpanishacronym,CRIM),and
ASUME,stating that it has nooutstanding debts.In addition,
theCONSULTANT shallpresenttotheBANKacertificateof
incorporationandaGoodStanding I Icertificate issued bythe
Department ofState ofPuerto Ricoas proofthat it is duly
authorizedtodobusinessinPuertoRicoandhascompliedwithitsannual
corporation report filing obligations.
\Itisexpresslyacknowledgedthattherepresentationsprovidedbythe
CONSULTANT in this Clause are essential conditions of this
Agreement, and ifthese
representationsareincorrect,theBANKshallhavejustcauseforitsimmediate
termination,and the CONSULTANT will have to reimburse the BANKany
sums of money received under this Agreement. 2 1 TheCONSULTANT
shall also beresponsible forproviding the BANKwith
thecertificationsrequiredunderthisClausefromanyprofessionalortechnical
consultant subcontracted by the CONSULTANT and authorized by the
BANK.Any personengagedbytheCONSULTANT inaccordancewiththeconditions
herein established, who dedicates twenty five percent(25%) or
moreofhis or hertime to
provideadvisoryservicesrelatedtotheAgreementshallbeconsidered
subcontractors for the purposes ofthis Clause.Notwithstanding
anything herein to thecontrary,theCONSULTANT
shallhavetherighttorelyconclusivelyonthe
aforementionedcertificationsfromgovernmentagenciesinmakingthe
representations in this Clause. TWENTY-FOURTH:The execution ofthis
Agreement shall not generate any
rightsfortheCONSULTANT,itspartners,employees,officers,directors,agents,
successorsorassignees,towhichtheofficersoremployeesof theBANKorthe
Commonwealth ofPuerto Rico or ofany agency, instrumentality or
municipality may beentitled as officersoremployees oftheBANKand the
Commonwealth ofPuerto I I Ricopursuanttolaworregulation
including,butnotlimitedto,vacationandsick leave,
workmen'scompensation, or any other such benefits.
TheCONSULTANTisanindependentcontractorandassuchshallbe
responsibleforthepaymentof allof
itsincometaxes,theirsubcontractors, andits individual and
employers'withholdings under the applicable tax laws of Puerto Rico
or the U.S. Internal Revenue Code.No withholdings or deductions
shall be made from payments to the CONSULTANT forservices rendered,
except those required byAct 22 No.48-2013,asamended,andas
applicable,thoserequiredinaccordancewiththe 1 1Puerto Rico Internal
Revenue Code and its regulations.The BANKshall forward any such
withholdings or deductions to the Secretary ofthe Treasury ofPuerto
Rico.The
BANKalsowillnotifytheSecretaryoftheTreasuryofallpaymentsand
reimbursements made to the CONSULTANT. TWENTY-FIFTH:The CONSULTANT
willnot receive any payment for the services rendered under the
terms ofthis Agreementuntil the Agreement has been registered by
the BANKat the Office ofthe Comptroller ofPuerto Rico as
established in Act Number 18 ofOctober 30,1975, as amended.
TWENTY-SIXTH:This Agreement and any dispute relating to the
services will be governed by and construed, interpreted and
enforced in accordance with the laws of the Commonwealth ofPuerto
Rico. TWENTY-SEVENTH:The CONSULTANT certifies it is not required to
obtain
adispensationincompliancewiththeapplicablelawsandregulationsofthe
Commonwealth of PuertoRicopriortoorinconnection
withtheexecutionofthis Agreement.
TWENTY-EIGHTH:ThisAgreementmaynotbeassignedbythe
CONSULTANT,exceptwiththewrittenconsentoftheBANK.Anyattempted
assignment in violation of the provisions hereofshall bevoidand
ofnoeffect.Both parties agree that the proven illegality ofany
ofits provisions shall not invalidate the 23 TWENTY-NINTH: It is
understood that this Agreement is the sole agreement
betweentheparties with regardtotheservices covered
herebyandsupersedes any prior agreements, written orverbal.The
Agreement maynot bechanged orally, but may be amended in writing by
mutual agreement ofthe parties.
INWITNESSWHEREOF,thepartiesheretosettheirhandsinSan Juan, Puerto
Rico, on this 16th day ofJuly, 2015. GOVERNMENT DEVELOPMENT BANK
FOR PUERTO RICO Melba Acosta Febo Tax Id. Number:umber: Government
Development Bank forDistrict View Plaza, Suite 400 644 Fernhdez
Juncos Avenue Roberto Sanchez Vilella GovernmentEmail:
[email protected] Tel. (787) 919-7303 De Diego Ave., Stop 22
Santurce, P.R. 00907 July gth, 2025 To:Lcda. Melba Acosta -
President,Government Development Bank Supporting "Grupode Trabajo
para la Recuperation Fiscal y Econdmica de Puerto RicoJJand the GDB
in the development of aDraf tFiscal Adjustment and Economic Growth
Plan("PMSupport") Asrequested,wearepleasedtosubmitour
proposal"Supporting ""Grupode Trabajo paraia Recuperacibtin Fiscal
yEconcimica de Puerto RicoNand the GDB in
thedevelopmentofaDraftFiscalAdjustmentandEconomicGrowth".Weappreciate
t he opportunity to offer our services insupport ofwhatweconsider t
o bea critical andhistoric momentfor Puerto Rico. Wear
edeeplycommittedt o t hesuccessofourclients,andadheret o t he
following guiding principles through our work: eFOCUS
onimpact.Wehelpclientsachievetangibleshort-andlong-term impact.
Focus on strategy. Our approach takes into account t he strategic
valueof each element of t he engagement, seeking t o provide
strategic insight inall aspects. 4 Know t he
culture.Wearekeenlyawareofculturalstrengthsand challengesandaret
husabletoadjustourrecommendationsto accomplish great results. I
----- VISIONTO ACTION
eRemainindependent.Wethinkindependentlyandofferourvision without
any particular agenda or bias. Bepractical. The solutions offered
ar e pragmatic and applicabte from "day I", andwe tryt o
leverageourclients'existingresourcest ominimize unnecessary or
excessive investments. This memo is structured in t hr ee chapters:
4 Background ' Methodofogy and workplan J Team and ProfessionalFees
BACKGROUND At t he request of t he Governor ofPuerto Rico,a group
ofeconomists and former officials oft he InternationalMonetary
Fund,headedbyAnne0. Krueger,Ph.D., submittedareport on t he
fiscalandeconomic situationofPuerto Ricoandt he sustainability
ofits debt("the Krueger report").
TheKruegerreportconcludesthat,althoughaggressivemeasureshavebeen
takent o address t he fiscalcrisis,iti snecessaryt o
takeadditionalandbroader measurestoresolvet hecrisisandt oleadt
heeconomy towardsasustainable development path. A Working Group
("GrupodeTrabajo paralaRecuperaci6n Fiscal y Econbmicade
PuertoRico")wascreatedbyt heGovernor throughExecutiveOrder(OE-2015-
022), t o developandrecommendadraftplancontainingallt heinitiatives
and/orstructuralreforms(including administrative
andlegislativemeasures) to -------- - ViSlONTO ACTION
dealwithPuertoRico'sfiscalchallenges andtopromoteeconomic growthand
competitiveness. it is inthis context t hatwehavebeenaskedby t he
GDB to assist t he Governor's I WorkingGroup
byprovidingprojectmanagement support int he preparationof such
plan. METHODOLOGY AND WORKPLAN
Ourapproachforthisprojectisorganizedinfour(4) phases:1)
Research& I Planning;2)DraftPlanPreparation;31,
PlanSyndication& Adjustment;and,4) Follow-upSupport.
1.Research&Ptanning-duringt heinitialphase,t het
eamwillreviewail
Irelevantinformationandconductinterviewswithkeystakeholders,
particularly with t he members of t he Working Group. Also during
this phase we willworkindefiningt
hecollaborationdynamicsbetweenV2A,t he WorkingGroup,GDB,andot
herconsultants.Att
heendofthisphaseweexpecttoagreeonaDraftPlanOutlinealongwithadetailedworkplan
(milestones,responsibilities, etc.) for t he reminder of t he
project. DraftPlanPreparation - wewillinitially approach this phase
by first defining
andagreeingon"guidingprinciples".Theseagreedprinciples
willfacilitate the Draft Plan Preparation.
PlanSyndication&Adjustment-duringthisnextphaseweexpectt o
syndicate t he Draft Plan to relevant stakeholders and t omake t he
necessary adjustmentspriort o t he publishing oft he final draft.
V2A'srole willbe t hatofmanagingt heprocessandcompifationoft
heDraftPlan.Allcont entincludedint heDraftPlanwillbe t
heresponsibilityoft he GDB and/ort he Working Group. 5r ga$jEs$, -
' iZ g",2E,&!= "22J ~ ~ F E Xg n wm y % c c w o ma mm. m cu 3 .
c6 1 0 - ; $ a g e E g"""Theproject toordinaton serve = Lcda Melba
Acosta - GDB President/asthe main contact persons cL.,--- - I
ExtendedTeam (as needed)Working TeamV2A Experts VZA: 3 Consultants
=Robeito Jimenez-VZADirector Josean Arroyo -V2AEngagement Manager
--. *Additionalresources as needed4'7;GeWorkTearnis responsible1
j-cforthe day-to-dayactivities of 3the project,including delivery
ofi 1work productsand mmmun1.raSieaolf pr~J~. ct status' L --- -^I-
within t he organizationsto /facilitie scheduling and1
Ourprofessionalfeesfort heproposedt hree-mont hengagement willbe I
communication. --- - *$390,000t obe invoicedon amonthly
basis($130,000per month). Wewillalso invoiceseparat el
yforanyout-of-pocketexpensesincurred,includingpre-
approvedtravelexpenses (ifrequired).This proposaf is subjected to
the t er ms and conditions described in Annex 1. We hope t
hatourproposalmeet s your needs and expectations and werei t erat e
our commi t mentt osuccessfulfyachieve GDB'sobjectives. Melba,we
are confident that we can provideGDB with world class support
inthis importantundertaking.Weappreciateyourtrustandtheopportunityt
o
collaborate.Ifyouhaveanyfurtherquestionsorobservations,pleasedonot
hesitate t o contact us. Sincerely, Roberto Jirnenez - ~ &e c t
o r V2A Agreed and approved by: Lcda.Melba Acosta,GDB President -
.- .-- -.-- VISIONTO ACTION ANNEX2 - Terms and Conditions Warrantta
and kSaihliit1~s
V2A,Inc.("V2An)willexercisedueprofessionalcareandcompet enceint he
performanceoft he services.However,V2Aassumesnoresponsibilityforany
decisions made by GovernmentDevelopment Bank of Puerto Rico
("GDBD), which ar e appropriatelyt hoseofmanagement . Innoevent,
regardlessoft helegal t heoryadvanced,shatlV2Abeliableor
responsiblet o anypersonorentity I including,butnotlimited to,GDB
ot her t han for its gross negligence and any such I liability
shall be limited to t heamountactually paid t oV2A under this
agreement
.Neitherpartyshatlbeliableforconsequential,incidental,indirect,punitiveo
rspecial damages (including loss ofprofits,dat a, business
orgoodwill),regardless ofwhet hersuchliabilityisbasedo n breachof
contract,tort, strictliability, I
breachofwarranties,failureofessentialpurposeor otherwise,andevenif
I advisedoft he likelihoodofsuchdamages. GDB'si ecourse withrespect
t oany I liabilityorobligation of V2Ahereunder shali be limitedto t
heasset s ofV2A,and
GOBshallhavenorecourseagainst,andshalfbringnoclaimagainst,any
employee of V2A. Indemnification GDB
agreestoindemnifyandholdV2Aharmlessagainstanylosses,claims,
Idamagesor liabilities,t o whichV2Amaybecomesubj ect
inconnectionwith serviceperformedpursuant t o thisagreement . furt
hermore, youagreeto reimburseV2Aforanylegalorot
herexpenses(including t heopportunity cost)
incurredbyV2Ainconnectionwithinvestigatingor defendinganyaction, fl
proceedings,investigation orclaim in connection therewith.- - -- -.
VISIONTO ACTl ON IHowever,GDB shallnotbe obligatedundert he
foregoing indemnityagreement I inrespectt o anyloss,claim,damageor
liabilityresultingfromt hegross Inegligenceof V2A.The
reimbursementand indemnity obligations for youunder this
paragraphshallbeinaddition t o any liabilityyoumay
otherwisehave,shall extendupon t he same t erms and conditionst o t
he employees ofV2A,and shall be bindingupon and inure t ot he
benefit of any of your successors, assignees and heirs. GDB agreest
hat itwillnot settle,compromiseordischargeanysuit,claim,
IIitigatioR, t hreat enedlitigationor threatenedclaim arising
outof,basedupon,orinany wayrelatedt othis agreementandadmitting any
wrongdoingunlessand
Iuntilyouhaveobtainedawrittenagreement,approvedbyV2A(which
shallnotbeunreasonablywithheld)andexecutedbyeachpartyt o
suchproposed settlement, compromise ordischarge,releasing V2A from
any and all liability. Use of Name
GDSagreestoallowV2Atolistitsnamea s afirmclientinitsexternal
communications.V2A willonly have t he right to describe t he name
and service iine,and willnotdisclose any informationrefatedto t he
nature oft he work,t he fees and terms, orany ot her detail ofits
relationship with GDB. Non Solicitation of Employees GDBagreesnott
oapproach,discuss,or offer employment ordirect contractual services
t o any ofV2Ats employeesor contractorsinvolvedinservingit,unless
expficitly discussed and agreed between GDB and V2A. T APPENDIX B
Indemnification and Limitation ofLiability Provisions The BANK
agrees to indemnify and hold harmless the CONSULTANT and its
affiliates,andtheirrespectivedirectors,officers,managers,members,partners,
employees,agentsandcontrollingpersons(theCONSULTANTandeachsuch
person being an "Indemnified Party") from and against any losses,
claims, damages, liabilities or expenses ("Claims,"and each a
"Claim"), jointor several, to which any
IndemnifiedPartymaybecomesubjectinconnectionwithanytransactions
contemplated by this Agreement or the engagement ofthe CONSULTANT
pursuant to, and the performance bythe CONSULTANT ofthe services
contemplated by,this Agreement. The BANKwillalso promptlyreimburse
any Indemnified Party for all
expenses(includingreasonablefeesandexpensesof
legalcounsel)astheyare incurredinconnection with investigating,
preparing todefend,ordefending such
ClaimsorinconnectionwithenforcingthisAppendixB,whetherornotsuch
Indemnified Party is a party and whether or not such Claim is
initiated or brought by oron
behalfoftheBANK.TheBANKwillnot,however,beresponsible forany
Claim(orexpensesrelatingthereto)totheextentthatitisfinallyjudicially
determined that such Claim resulted from the gross negligence or
willful misconduct ofan Indemnified Party. Thereimbursement and
indemnity obligations under this paragraph and the following
paragraphs shall inure to the benefit ofthe Indemnified Parties and
their respective successors and assigns. If the indemnification of
an Indemnified Party provided for in this Agreement is for any
reason held unenforceable, the BANK agrees to contribute to the
Claims for
whichsuchindemnificationisheldunenforceable(a)insuchproportionasis
appropriate toreflecttherelative benefitstotheBANK,on theone hand,
andthe IndemnifiedParties,ontheotherhand,oftheservices
renderedpursuanttothe Agreementor(b) if(but onlyIf) theallocation
providedforinclause(a) ofthis paragraph is for any reason held
unenforceable, in such proportion as is appropriate
toreflectnotonlytherelative benefits referred toin suchclause(a)
butalsothe relative fault oftheBANK,on theonehand,andtheIndemnified
Parties,on the other hand,as well as any other relevant equitable
considerations; provided that in no event shall the Indemnified
Parties be required to contribute an aggregate amount in excess
ofthe aggregate fees actually paid to,and retained by,the
CONSULTANT under this Agreement except to the extent that it is
finally judicially determined that
suchClaimsresultedfromthegrossnegligenceorwillfulmisconductofan
IndemnifiedParty.TheBANKagrees that
forthepurposesofthisparagraphthe relativebenefits to
theBANKandtheIndemnified Partiesofanytransaction into which the
BANKproposes to enter and for which it intends to use the product
ofthis Agreement shall be deemed to bein the same proportion that
the total value paid or contemplated to be paid or received or
contemplated to be received by the BANKas a result ofor in
connection with such transaction bears to the fees paid or to be
paid totheCONSULTANTunderthisAgreement(exclusiveofamountspaidfor
reimbursementofexpensesunderthisAgreementoramountspaidtoan
Indemnified Party under this Appendix B). TheBANKagrees
that,without theCONSULTANT'S priorwritten consent, which consent
shall not be unreasonably withheld, conditioned or delayed, it will
not settle,compromiseorconsenttotheentryofanyjudgmentinanypendingor
threatened claim, action or proceeding in respect ofwhich
indemnification could be sought under the indemnification
provisions ofthis Agreement (whether or not the CONSULTANT or any
other Indemnified Party is an actual or potential party to such
claim, action or proceeding) unless such settlement, compromise or
consent includes an acknowledgement ofthe absence ofwrongdoing
byall ofthe Indemnified Parties and an unconditional release ofeach
Indemnified Party from all liability arising out ofsuch claim,
action or proceeding. NoIndemnified Person seeking indemnification,
reimbursement or contribution under this Agreement will, without
the BANK'S prior written consent, settle, compromise or consent to
the entry ofany judgmentin any
pendingorthreatenedclaim,actionorproceedinginrespectofwhich
indemnificationcouldbesoughtundertheindemnificationprovisionsofthis
Agreement (whether or not the CONSULTANT or any other Indemnified
Party is an actual or potential party to such claim, action or
proceeding).
IntheeventthatanyIndemnifiedPartyisrequestedorauthorizedbythe
BANKor is required bygovernment regulation, subpoena, or other
legal process to produce the CONSULTANT'S documents as evidence or
personnel as witnesses with respect to the CONSULTANT'S services
for the BANK, the BANK will, so long as the
CONSULTANTisnotapartytotheproceedingin whichinformation issought,
reimburse the CONSULTANT for its professional time and expenses, as
well as the reasonable fees and expenses ofits counsel, incurred in
responding to such requests.
Innoevent,regardlessofthelegaltheoryadvanced,shalltheaggregate
liabilityoftheIndemnifiedPartiestoanypersonorentity,including
theBANK,
exceedtheamountoffeesactuallypaidto,andretainedby,theCONSULTANT
underthisAgreementexcepttotheextentthatsuchliabilityisfinallyjudicially
determined to have resulted from the gross negligence or willful
misconduct ofan
IndemnifiedParty.Neitherpartyshallbeliabletotheotherforconsequential,
incidental,indirect,punitiveorspecialdamages(including
lossofprofits,data, business or goodwill), regardless ofthe legal
theory advanced or ofany notice given as to the likelihood ofsuch
damages; provided that (i) this provision shall not limit
anIndemnifiedParty'sindemnityorcontributionrightsasprovidedforinthis
Agreement or applicable law and (ii) damages required to be paid by
an Indemnified Party to any third party that is not an Indemnified
Party maybeconsidered direct
damagestosuchIndemnifiedParty.TheBANK'Srecoursewithrespecttoany
liability or obligation ofthe CONSULTANT hereunder shall belimited
to the assets ofthe CONSULTANT, and the BANKshall have no recourse
against, and expressly waives its right to bring any claim
against,anyother Indemnified Partyoranyof their assets.
Theforegoing provisionsofthisAppendixBareinadditiontorightsthe
CONSULTANT mayhave under law orequityorotherwise and shall inure to
the benefitoftheIndemnified Parties and theirrespective successors
and assigns.The provisionsofthis Appendix Bshall remain in full
force and effect notwithstanding any termination or expiration
ofthis Agreement.