HomeMy WebLinkAboutRES 85-099 �s- 9 9
R E S O L U T I O N
WHEREAS, the City of Beaumont intends to issue 7 .4 million
dollars in Water System Certificates of Obligation; and,
WHEREAS, the City desires to retain the firm of Underwood
Neuhaus and Co. to act as financial advisor to the City in such
sale;
NOW, THEREFORE, BE IT RESOLVED BY THE
CITY COUNCIL OF THE CITY OF BEAUMONT:
THAT the City Manager be, and he is hereby, authorized to execute a
contract with Underwood Neuhaus and Co. to act as the City' s
financial advisor in the sale of 7 .4 million dollars of Water System
Certificates of Obligation, said contract to be substantially in the
form attached hereto as Exhibit "A" .
PASSED BY THE CITY COUNCIL of the City of Beaumont this
the day of 1985.
- Mayor -
FINANCIAL ADVISORY CONTRACT
Date : March 26, 1985
Mayor and City Council
City of Beaumont
Beaumont, Texas
1. We understand that you are contemplating the issuance of
$7, 400, 000 Water System Certificates of Obligation and that in.
connection with the issuance of these securities you desire this
proposal from us to perform professional services in the capacity
of Financial Advisor for City of Beaumont, Texas (hereinafter
called " Issuer" ) .
2. By this proposal we offer our professional services as
Financial Advisor for the issuance and sale of the above
described certificates , and in that capacity we agree to perform
the following duties and such other duties, as, in our judgment,
may be necessary or advisable:
a. We will make a survey of the financial resources of the
Issuer, including an analysis of the existing debt
structure as compared to exi �ti Tg and projected sources
of income which may be pledged to secure payment of the
Issuer ' s certificates , the Issuer ' s taxing power, and its
present and future taxing requirements. If the revenues
of a system or facilities are to be pledged to repayment
of such certificates, the survey will take into account
any outstanding obligations which are payable from the
net revenues thereof, projected net revenues, to arise
Exhibit "A"
from any prop=osed rate increase, and the additional
revenues and expenses, projected by your consulting
engineers, resulting from the proposed improvements . We
wi1T - also take into account future financing needs and
= operations ' as 4^ projected by r'your' 'staff ` and/dr your
consulting engineers and other experts
b. We will , under the direction of the bond attorneys,
assist in coordinating the assembly and transmittal to
the bond attorneys such data as may be required for the
preparation of the necessary petitions, orders,
resolutions, notices and certificates in -connection with
the certificates of obligation.
c. On the--' basis -of the information -developed by the survey
described in paragraph 2. a. , and on the basis of
marketing experience and other information available to
us, we will submit our financing recommendations, which
will include recommendations as to the date of issue,
inter c-t paayment dates, schedule of principal maturities,
options of prior payment, and any additional
provisions. All recommendations will be based on our
best professional judgment, with the goal of designing
certificates which can be sold under terms most
advantageous to the Issuer, and at the lowest interest
cost consistent with all other considerations.
2
advantageous to the It,suer`; and at the lowest interest
cost consistent with all other considerations .
d. We will advise you of current market conditions,
forthcoming issues, and other general information and
economic data which might normally be expected to
influence interest rates, so that the date for the sale
of the certificates can be set at a time, which, in our
opinion, will be best for the Issuer.
e. We will coordinate the compilation and submission of the
Official Notice of Sale, the Official Bid Form, the
preliminary and final Official Statements or Offering
Statements, and such other market documents which may be
required (collectively, the "Offering Documents" ) . We
will submit the Offering Documents for your proper
examination , approval and certification .
f. We will make recommendations concerning rating (s ) for the
proposed issue and when directed by you shall coordinate
the compilation of such information as i^ our epi n i omj is
required for submission to the rating agency(ies ) . In
those cases where the advisability of personal
presentation of information to a rating agency may be
indicated, we will arrange for such personal
presentation .
g. If the certificates are to be sold at public sale we will
disseminate the Offering Documents to prospective
3
bidders, will organize such information meetings as in
our judgment may be necessary, and will work with
prospective bidders to assist them in timely submitting
proper bids. We will assist you in the sale in
coordinating the receipt of bids and good faith checks ,
in tabulating and comparing bids, and in recommending
acceptance or rejection of the winning bid. As soon as
such bid shall be accepted by you, we will proceed to
coordinate the efforts of all concerned to the end that
the . certificates may be delivered and paid for as
expeditiously as possible. We shall assist you in the
preparation or verification of final closing figures, and
when requested, will provide suggestions on a program of
temporary investment of bond proceeds, in consultation
with your architect or consulting engineer, consistent
with the construction timetable for the project.
h. We will arrange for the printing of the certificates,
will submit same for execution and impression of seal ,
and will attend to their delivery to the Attorney General
�1 7,�xas for approval and to tole Comptrol l r-:,. of Publ i c
Accounts of the State of Texas for registration . Title
to and ownership of the printed certificates shall remain
with the Issuer until they are delivered to and paid for
by the bidder (the "Purchaser" ) whose bid has been
accepted by you .
4
i . We will deliver to you and- the appropriate paying agent
bank (s ), a schedule of annual debt service requirements
on the certificates being delivered to the Purchaser.
3. We agree to direct and coordinate the entire program of
financing herein contemplated. In that connection we understand
that you have retained' or expect to retain Vinson & Elkins,
Houston, Texas , a firm of recognized municipal bond attorneys who
will prepare the appropriate legal proceedings and documents,
will advise the steps necessary to issue the certificates, and
will issue an opinion approving their legality and exemption from
taxation . We will maintain liaison with this firm of bond
attorneys and shall assist in all financial advisory aspects
involved in the compilation of the appropriate legal proceeds and
documents. -
Where the issuance and . sale of the certificates requires the
approval of any state or governmental agency, we shall assist you
in the compilation of all financial information required for
inclusion in application for such approval , and when requested by
you, we shall i3oucar "on your behalf to pr-ovide appropriate
testimony at public hearings before state and other governmental
commissions and boards . We will also be available to participate
with you in any preliminary conferences with the staffs of any
state or governmental agencies involved, and we will , for
qualified projects, coordinate the compilation of assistance
applications required for governmental involvement .
5
4. In consideration for the. services rendered by us in
connection with the . issuance and sale of the above-referenced
certificates it is understood and a
greed- that . ou,r_ fee will be set
out in the attached schedule following, which fee, together with
certain reimbursable expenses , shall become due and payable
simultaneously with the delivery of the certificates to the
Purchaser.
a. The following fee schedule applies to each separate
issuance of certificates :
If the Amount of Certificates
Delivered to Purchaser Is :
and not
More Than More Than The Fee Is:
$ -0- $ 150,000 $ 3,300
$ 150,000 $ 250,000 $ 3,300 plus $12 per $1,000
for all over $150,000
$ 250,000
$ 350,000 $ 4,500 plus $7.25 per $1,000
$ 350,000 for all over $250,000
$ 700,000 $ 5,225 plus $3.50 per $1,000
$ 700,000 for all over $350,000
$ 1,000,000 $ 6,450 plus $3.00 per $1,000
for all over $700,000
$ 1,000,000 $ 5,000,000 $ 7,350 plus $2.50 per $1,000
for all over $1,000,000
$ 5,000,000 $10,000,000 $17,350 plus $1.25 per $1,000
for all over $5,000,000
$10,000,000 $20,000,000 $23,600 plus $1.00 per $%000
for all over $10,C"jx)�C�00
$20,000,000 , No Limit $33,,600 plus $0.40 per ,� ,000
for al 1 over $20,Ojo,OO
b. Expenses of Bond Attorneys , printing, costs of Bond
Rating Agencies, travel expenses outside the State of
Texas , costs of advertisements, printing and other
costs related to publishing of the Notice of Sale,
Official Statement and other documents shall not be
covered by the fee set forth above.
6 g
5. It is further understood and expressly agreed that the
Financial Advisor `reserve s + the . right to submit . a bid for the
certificates when offered for sale'- at`- public bid.
J6. This agreement shall be terminated by the delivery to the
Purchaser of all the certificates covered hereby, whether
delivered all at one time, or in installments.
7. This proposal is submitted in duplicate originals. When
accepted by the Issuer it will constitute the entire agreement
between the Issuer and the undersigned for the purpose and
considerations herein specified. Your acceptance will be
indicated by proper signatures of your authorised officers or
representatives on both copies and the returning of one executed
copy to us :
Respectfully Submitted,
B Z
Frank J . Ildebrando
Vice President
Underwood, Neuhaus & Co. .Incorporated
ACCEPTED pursuaiit to a motion passed by the City Council, on
this of 1985.
City Manager
ATTEST:
City Secretary
7