HomeMy WebLinkAboutRES 08 199 RESOLUTION NO. 08-199
BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF BEAUMONT:
THAT the City Council hereby approves a three(3)year financial advisory agreement with
RBC Capital Markets. The agreement is substantially in the form attached hereto as
Exhibit "A" and made a part hereof for all purposes.
PASSED BY THE CITY COUNCIL of the City of Beaumont this the 1 st day of July,
2008.
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%o M19yor Becky Ames -
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RBC Fr=kJ.Ildebrando Ryan O'Hara
Capital
Managing Director Director
Municipal Finance Municipal Finance
n .Markets Phone:(713)651-3370 Phone: (713)853-0830
Fax(713)651-3347 Fmc (713)651-3347
FrankIdebrandorarbccm.com Ryan.Oharaa)xbccm.com
July 1,2008
Mayor and City Council
City of Beaumont,Texas -
801 Main
Beaumont,TX 77704
Ladies and Gentlemen:
1. Retention of RBC Capital Markets Corporation. We understand that the City of Beaumont, Texas
("Issuer" or "you') will have under consideration the issuance of obligations evidencing indebtedness
("Obligations'), either in a single financing or in a series of financings, and that in connection with the
issuance of such Obligations you hereby agree to retain RBC Capital Markets Corporation (`RBC CM") as
your financial advisor in accordance with the terms of this financial advisory agreement("Agreement'). This
Agreement shall apply to all Obligations that may be authorized and/or issued or otherwise created or
assumed during the period in which this Agreement is effective.
2. Scope of Services. As financial advisor,we agree to perform the following services:
(a) Analyze the financing alternatives available to the Issuer, taking into account its borrowing capacity,
future financing needs, policy considerations, and such other factors as we deem appropriate to
consider.
(b) Recommend a plan for the issuance of Obligations that will include: (1) the type of bonds (current
interest, capital appreciation, deferred income, etc.); (2) the date of issue; (3) principal amount; (4)
interest structure (fixed or variable); (5)interest payment dates; (6)a schedule of maturities; (7)early
redemption options; (8) security provisions; (9) appropriate management fee and takedown; and (10)
other matters that we consider appropriate to best serve the Issuer's interests. To the extent
appropriate,the plan will address strategies in addition to the issuance of obligations, such as interest
rate derivative transactions.
(c) Advise you of current conditions in the relevant debt market,upcoming bond issues,and other general
information and economic data which might reasonably be expected to influence interest rates,bidding
conditions or timing of issuance.
(d) Organize and coordinate the financing team. Unless otherwise directed by you, we will select the
paying agent, escrow agent and verification agent, as the particular transaction may require, each of
whom will be retained and compensated by you. In a negotiated offering,we will solicit and evaluate
underwriter proposals upon request and make a recommendation for the hiring of the underwriter(s).
EXHIBIT "A"
(e) Work with counsel on the transaction, including bond counsel whom you retain, who will be
recognized municipal bond attorneys, whose fees will be paid by you, and who will prepare the
proceedings, provide legal advice concerning the steps necessary to be taken to issue the Obligations,
and issue an unqualified opinion(in a form standard for the particular type of financing)approving the
legality of the Obligations and(as applicable)tax exemption of the interest paid thereon. In addition,
bond counsel will issue an opinion to the effect that the disclosure document does not contain an untrue
statement of a material fact or omit to state a material fact necessary in order to mare the statements
contained therein, in light of the circumstances under which they were made, not misleading.
Generally, working with counsel will mean coordinating With the attorneys and assisting in the
financial advisory aspects of preparing appropriate legal proceedings and documents, including
documents concerning any required election.
(f) Assist in the Issuer's preparation of the Preliminary Official Statement CPOS') and the Official
Statement ("OS') or equivalent document as the particular transaction may require (such as a private
placement memorandum).
(g) In connection with a competitive sale,we will:
i coordinate the preparation of the Official Notice of Sale, the Uniform Bid Form (containing
provisions recognized by the municipal securities industry as being consistent with the
securities offered for sale) and other such documents which you may request or deem
appropriate;
ii. submit all such documents for examination,approval,and certification by appropriate officials,
employees,and agents of the Issuer,including bond attorneys;
iii. coordinate delivery of these documents to a list of prospective bidders;
iv. where appropriate,organize investor meetings;
V. coordinate the receipt of bids;
vi. advise as to the best bid,including acceptance or rejection of the best bid;
Vii. if a bid is accepted,coordinate the delivery of and payment for the Obligations;
va assist in verification of final closing figures;
ix. provide copies of documents to the purchaser of the Obligations in accordance with the terms
of the Official Notice of Sale and the Uniform Bid Form.
(h) Make recommendations as to the need for credit rating(s)for the proposed Obligations and, should the
Issuer seek a rating, coordinate the process of working with the rating agency or agencies and assist in
the preparation of presentations as necessary.
(i) Make recommendations as to obtaining municipal bond insurance, a liquidity facility or other credit
enhancement for the Obligations and, should the issuer seek any such credit enhancement, coordinate
the process and assist in the preparation of presentations as necessary.
(j) Attend meetings of governing bodies of the Issuer,its staff,representatives or committees as requested.
(k) After closing,we will deliver to the Issuer and the paying agent(s)definitive debt records,including a
schedule of annual debt service requirements on the Obligations.
You acknowledge that advice and recommendations involve professional judgment on our part and that the results
cannot be,and are not, guaranteed.
3. Information to be Provided to$BC CIVL You agree(upon our request)to provide or cause to be provided
to us information relating to the Issuer,the security for the Obligations, and other matters that we consider
appropriate to enable us to perform our duties under this Agreement. With respect to all information provided
by you or on your behalf to us under this Agreement,you agree upon our request to obtain certifications(in a
form reasonably satisfactory to us) from appropriate Issuer representatives as to the accuracy of the
information and to use your best efforts to obtain certifications (in a form reasonably satisfactory to us)from
representatives of parties other than the Issuer.You acknowledge that we are entitled to rely on the accuracy
and completeness of all information provided by you or on your behalf.
4. Oftial Statement. You acknowledge that you are responsible for the contents of the POS and OS and will
take all reasonable steps to ensure that the governing body of the Issuer has reviewed and approved the
content of the POS and OS. You acknowledge that you are subject to and may be held liable rider federal or
state securities laws for misleading or incomplete disclosure. To the extent permissible by law,you agree to
indemnify and hold us harmless against any losses, claims, damages or liabilities to which we may become
subject under federal or state law or regulation insofar as such losses,claims,damages or liabilities(or actions
in respect thereof) arise out of or are based upon omission or alleged omission to state in the disclosure
document a material fact required to be stated therein or necessary to make the statements therein not
misleading, and will reimburse us for any legal or other expenses reasonably incurred by us in connection
with investigating or defending any such loss,claim,damage,liability or action.
5. G-23: Competitive Issue. In connection with Rule G-23 of the Municipal Securities Rulemaking Board,the
Issuer agrees that RBC CM may submit a bid(either independently or as a member of a syndicate)for any
issue of Obligations when offered for sale at competitive bid and prior to submitting any such bid we shall
obtain the Issuer's written consent to bid on the particular issue of Obligations.
6. G-23: Negotiated Issue. If,during the term of the Agreement,we are asked to serve as underwriter with
respect to any issue of Obligations of the Issuer to be sold on a negotiated basis,we will,by written notice to
the Issuer and upon the Issuer's written consent,terminate our obligations under this Agreement with respect
to that issue of Obligations. This Agreement,however,will stay in effect with respect to other Obligations of
the Issuer for which we are not acting as underwriter.
7. Fees and Expenses. In connection with the authorization,issuance, and sale of Obligations, you agree that
our fee will be computed as shown on the "Fee Schedule" attached hereto. Our fee will become due and
payable simultaneously with the delivery of the Obligations to the Purchaser. Our fee does not include and
we will be entitled to reimbursement from you for any actual"out-of-pocket"expenses incurred in connection
with the provision of our services, including reasonable travel expenses or any other expenses incurred on
your behalf. These expenses will be due and payable when presented to the Issuer, which normally will be
simultaneously with the delivery of the Obligations to the Purchaser.
8. Interest Rate Derivatives. If you decide to consider the use of interest rate derivative products as part of the
financing plan for Obligations covered by this Agreement,we will be pleased to provide our assistance upon
request. The nature of our assistance will be set forth in an amendment to this Agreement or in another
separate document.
9. Term of Agreement and Waiver of Sovereign Immunity. This Agreement shall be for a period of 36
months(the"Term")from its date;however,this Agreement may be terminated by either party upon 30 days
written notice. If neither party provides written termination prior to the end of the Term,this Agreement will
automatically renew for another Term. You agree and understand that this Agreement is a contract for
services and waive any claims you may have that you are immune from suit by virtue of any law, statute, or
claim for any matter arising from or relating to this Agreement. Paragraphs 4, 7 (insofar as it concerns
reimbursable expenses) and 9 (insofar as it concerns waiver of sovereign immunity) will survive any
termination of this Agreement.
10. Mincelaneoua Provisions. Agreement is submitted in duplicate originals. Your acceptance of this
Agreement will occur upon the return of one original executed by an authorized Issuer representative,and you
hereby represent that the signatory below is so authorized. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability of any other provision of the Agreement,
which shall remain in hill force and effect. This Agreement constitutes the entire agreement between the
parties as to the subject matter thereof and supersedes any prior understandings or representations. This
Agreement may be amended or modified only by a writing signed by both parties. This Agreement is solely
for the benefit of you and RBC CM,and no other person. RBC CM may not assign this Agreement without
your prior written consent.
Respectfully submitted,
RBC CAPITAL MARKETS CORPORATION
By By
Name Frank Ildebrando Name Ryan O'Hara
Title Managing Director Title Director
Date Date
ACCEPTANCE
ACCEPTED pursuant to motion adopted by the governing body of City of Beaumont,Texas on July 1, 2008.
By
Name
Title
Attest:
By
Name
Title
Date
03/03/08
FEESCHEDULE
In consideration for the services rendered by RBC CM, the Issuer agrees that our fee for each issue of
Obligations will be as follows:
STANDARD FEE SCHEDULE
More And Not
Than More Than The Fee Is
$ -0- $ 500,000 $5,000(minimum fee)
$ 500,000 $ 1,000,000 $5,000 plus$5.00 per$1,000 for all
over$500,000
$1,000,000 $5,000,000 $7,500 plus$2.50 per$1,000 for all
over$1,000,000
$5,000,000 $10,000,000 $ 17,500 plus$1.25 per$1,000
for all over$5,000,000
$10,000,000 $20,000,000 $23,500 plus$1.00 per$1,000
for all over$10,000,000
$20,000,000 No Limit $33,500 plus$0.40 per$1,000
for all over$20,000,000
Fees for refunding Obligations and/or other Obligations involving escrow Agreements, will be the fee schedule
set out above plus 25%, and, in addition to our Financial Advisory fee, we will charge a structuring fee to be
negotiated on a case-by-case basis. The additional fees will not exceed 25% of the fee set out in the schedule
above.
RBC CM will bill the Issuer at Closing for each issue of Obligations a net amount which will include a fee
calculated on the above schedule as well as any"out-of-pocket"expenses incurred on behalf of the Issuer.
03/03/08