HomeMy WebLinkAboutResolution - 042877A - Financial Advisory Contract - Issuance And Sale Of GO Bonds - 04_28_1977FINANCIAL ADVISORY CONTRACT
IM.A.C. Form C-1 Revised. Standard Form o) Agreement between Political Subdivision
and Financial Advisor Covering Issuance of Securities. Form approved by the Municipal
Advisory Council for Use of Members Only.)
Date April 28,_1977
To: Honorable Mayor and
City Council
City of Lubbock
Lubbock, Texas
Gentlemen:
1. We understand that you are contemplating the issuance of securities of the kinds, in the amounts,
and for the purposes indicated as follows:
$26,435,000 General Obligation Bonds
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 Lubbock
(hereinafter called "Issuer").
2. By this proposal we offer our professional services and our facilities as Financial Advisor for the
issuance and sale of the above -described securities, and in that capacity we agree to perform the following
duties, and to perform 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 to determine the extent of its
borrowing capacity. This survey will include an analysis of the existing debt structure as com-
pared to existing and projected sources of income which may be pledged to secure payment of
debt service, and where appropriate, will include a study of the trend of the assessed valuation of
the Issuer, the Issuer's taxing power, and the present and estimated future taxing requirements.
If the revenues of a system or facility are to be pledged to repayment of the securities in ques-
tion, the survey will take into account any outstanding obligations which are payable from the
net revenues thereof, additional net revenues to arise from any proposed rate increase, and the
additional net revenues as projected by your consulting engineers as a result of the improve-
ments to be financed by the securities in question. We will also take into account your future
financing needs and operations as projected by your staff and/or your consulting engineers and
other experts.
b. On the basis of the information developed by the survey described in the above and foregoing
paragraph, and on the basis of other information and experience available to us, we will submit
our written recommendations on the financing in question. Our plan will include recommenda-
tions as to the date of issue, interest payment dates, schedule of principal maturities, options of
prior payment, and any other necessary additional security provisions designed to make the is-
sue more attractive to investors. All recommendations will be based on our best professional
judgment, with the goal of designing securities which can be sold under terms most advan-
tageous to Issuer, and at the lowest interest cost consistent with all other considerations.
c. We will advise you of current bond market conditions, forthcoming bond issues, and other gen-
eral information and economic data which might normally be expected to influence the interest
rates or bidding conditions, so that the date for the sale of the securities can be set a time,
which, in our opinion, will be favorable.
d. If it is necessary to hold an election to authorize the securities, we will, under the direction of the
bond attorneys, assist in coordinating the assembly and transmittal to the bond attorneys of
such data as may be required for the preparation of the necessary petitions, orders, resolutions,
notices and certificates in connection with the election.
e. We will coordinate the preparation and submission of the Official Notice of Sale, the Official
Statement or Offering Statement, and such other market documents which you may require. We
will also supervise preparation of the uniform bid form, containing provisions recognized by the
municipal securities industry as being consistent with the securities offered for sale. We will
submit to you all such offering documents, including the Official Statement, for your proper
examination, approval and certification. After such examination, approval and certification we
will furnish you with a supply of such documents and shall mail a set of the same to a list of
prospective bidders, a copy of which list shall be submitted to you upon request. We will also
supply sufficient copies of the Official Statement or Offering Statement to the purchaser of the
securities in accordance with the terms of the Notice of Sale.
f. We will make recommendations to the Issuer on the matter of bond rating(s) for the proposed
issue and when directed by you shall coordinate the preparation of such information as in our
opinion is required for submission to the rating agency(ies). In those cases where the advisa-
bility of personal presentation of information to the bond rating agencies may be indicated, we
will arrange for such personal presentation.
If the securities are to be sold at public sale we will disseminate information to prospective bid-
ders, we will organize such information meetings as in our -judgment may bea necessary, and will
work with prospective bidders to assist them in timely submitting proper bids. We will assist
you at the bond sale for the purpose of coordinating the receipt of bids, and the furnishing of
good faith checks where indicated, and for the purpose of tabulation and comparison of bids, and
will advise you as to the best bid, and will provide our recommendation as to acceptance or rejec-
tion of such bid. As soon as a bid for the bonds shall be accepted by you, we will proceed to co-
ordinate the efforts of all concerned to the end that the bonds may be delivered and paid for as
expeditiously as possible. Should the bonds be eligible under Texas laws for purchase by the State
Board of Education, the Financial Advisor will be responsible for the preparation -of an Applica-
tion for Purchase or Waiver and its timely submission to the Board. 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 the Issuer's archi-
tect or consulting engineer, consistent with the - construction timetable for the project.
h. We will act as your agent in arranging for the printing of the securities, and will submit same
for execution and impression of seal, and we will attend to their delivery to the Attorney General
for approval and the Comptroller of Public Accounts for registration, it being understood that
title to and ownership of the printed securities shall be in the Issuer until they are sold and de-
livered to the purchaser.
After closing we will deliver to you and your paying agent(s) definitive debt records, including a
schedule of annual debt service requirements on the obligations being delivered to the purchaser.
3. We agree to direct and coordinate the entire program of financing herein contemplated. In that con-
nection we understand that you have retained or expect to retain Duman ,gig +Pn n, Boothman &
Marrow, Dallas, Texas , a firm of recognized municipal bond attorneys, who will prepare
the proceedings and advise the steps necessary to be taken to issue the securities and who will issue an
opinion approving their legality. We will maintain liason with this firm of bond attorneys and shall assist
in all financial advisory aspects involved in the preparation of appropriate legal proceedings and docu-
ments.
Where the issuance and sale of the securities, and construction of the project in question, requires
the approval of any state or governmental agency, we shall assist you in the preparation of all financial
information required for inclusion in applications for such approval, and when requested by you, shall
appear on your behalf to provide appropriate testimony at public hearings before state and other govern-
mental commissions and boards. We will also be available to participate with you in any preliminary con-
ferences with the staffs of any state or governmental agencies involved, and we will, for qualified proj-
ects, coordinate the preparation of financial assistance applications required for state involvement.
4. In consideration for the services rendered by us in connection with the issuance and sale of the
above -described securities it is understood and agreed that our fee will be as follows:
For each installment of bonds:
$12,500ifor $1,000,000 bonds; plus $4.65 per $1,000
or a total of $19,475 for $2,500,000 in Bonds; plus
next $2,500,000, or a total of $26,350 for a total
plus $2.25 per $1,000 for all over $5,000,000.
for the next $1,500,000;
$2.70 per $1,000 for the
of $5,000,000 in Bonds;
In consideration of the above fee we will assume and be responsible for the following expenses:
1. All travel and communication expense of First Southwest Company including
travel to.New.York.
2. Election supplies and ballots, but not costs of publication of legal notices,
fees of election officials, or the cost of any litigation.
3. Bond attorneys' fees and charges.
4. Bond printing.
5. Cost of reproduction in our offices of the Official Notice of Sale and
Official Statement and the mailing of these documents.
— 2 —
Our fee and reimbursable expenses shall become due and payable simultaneously with the delivery of
the securities to the purchaser.
b. In the event any bond election be necessary, if such election shall fail, the fee due us shall be
nothing ; however, should the same or similar propositions again be submitted
to election held within 24 months from date hereof, then at our option the agreement covered
by this proposal shall apply to any such securities.
6. It is further understood and agreed that we reserve the right to submit a bid for the securities
when offered for sale.
7. This agreement shall be terminated by the delivery to the purchaser of all the securities covered
hereby, whether delivered all at one time, or in installments.
8. Special Conditions. In addition to the terms and obligations herein contained, this proposal and
agreement is subject to the following special conditions:
The City - agrees to pay the cost of bond ratings frcm Moody's
Investors Service, Inc., New York, New York, and Standard & Poor's
Corporation, New York, New York, and the expenses of travel of
City officials to New York.
9. This proposal is submitted in duplicate originals. When accepted by Issuer it will constitute the
entire agreement between Issuer and the undersigned for the purpose and considerations herein specified.
Your acceptance will be indicated by proper signatures of your authorized officers or representatives on
both copies and the returning of one executed copy to us:
Res su itted,
Fi It So west Com y
By
Au hori d Representative
ACCE NCE
ACCEPTED pursuant to a motion _ adopted by the City Council
of City of Lubbock
on this 28 of April 19 77
Title Mayor, City of Lubbock, Texas
41
ATTEST:
R•;*to City Secretary, C-ty of Lubbock, Texas
'p (ed as to form:
Emd Q, $enter, Jr., City
(SEAL)
M.A.C. Form C-1
Rev. September. 1976