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HomeMy WebLinkAbout7845RESOLUTION NO. 7845 A RESOLUTION SELECTING A FINANCIAL ADVISOR TO THE CITY OF PUEBLO, APPROVING AN AGREEMENT FOR FINANCIAL ADVISORY SERVICES AND AUTHORIZING THE PRESIDENT OF THE CITY COUNCIL TO EXECUTE SAME BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that: SECTION 1 Pri nr-i na 1 Financial SQ...c uri t i ac ., Tnrr is hereby selected as financial advisor to the City of Pueblo for a term of 36 months. SECTION 2 The Agreement For Financial Advisory Services attached hereto, having been approved as to form by the City Attorney, is hereby approved. The President of the City Council is authorized to execute and deliver the Agreement For Financial Advisory Services in the name of the City with such modifications thereto as the President of the City Council and City Attorney shall approve. The City Clerk is directed to affix the seal of the City thereto and attest same. AT T ES'T: City Clerk INTRODUCED: April 22, 1996 By ChZr1Q- TnnP. Councilperson APPROVED: Presid t of the City Council AGREEMENT FOR FINANCIAL ADVISORY SERVICES THIS AGREEMENT entered into as of May 1, 1996 between Pueblo, a municipal corporation, 1 City Hall Place, Pueblo, Colorado, 81003 (the "City ") and Principal Financial Securities, Inc. (the "Company "). WHEREAS, City is interested in engaging a competent, qualified firm to act as City's financial advisor with respect to issues of City's municipal securities, and WHEREAS, Company is competent and qualified to act as City's financial advisor. NOW, THEREFORE, in consideration of the foregoing and mutual covenants contained herein, City and Company agree as follows: 1. Company shall provide financial advisory services to or on behalf of the City with respect to issues of municipal securities, including but not limited to, general obligation bonds, revenue bonds, certificates of participation, lease purchase agreements, anticipation financing, tax increment financing, industrial development bonds and /or any refunding or refinancing of any such bonds or financing (herein "Municipal Securities "). 2. Company shall perform the duties normally performed by a financial advisory or consultant including without limitation: (a) Assist members of City's administrative staff and consulting professionals (if retained by the City) in studies of City's past and future revenues and operating expenses, assets, liabilities, tax base, current debt service, and on the basis of such studies and City's needs, to devise and recommend the most advantageous and economical plans for the issuance, refunding or refinancing of Municipal Securities including advice with respect to the structure, timing, terms and other similar matters concerning such issues of Municipal Securities. Such plans shall set forth details and assumptions based upon such studies and other relevant matters including maturity schedules and other terms and conditions, such as options of prior payment and the like, as will result in the issuance of Municipal Securities under terms and conditions most advantageous to the City consistent with minimum cost and effective interest rates and within the parameters and limitations specified by the City's Director of Finance. (b) Under the direction and legal advice of a firm of recognized municipal bond attorneys selected by City, Company will assist City in and supervise the steps necessary to be taken in the legal issuance of Municipal Securities and the final delivery of the Municipal Securities to the purchaser. (c) At such time as it shall be decided to issue Municipal Securities, Company will assemble and transmit to the bond attorneys, such data as may be required in the preparation of the necessary resolutions, ordinances, notices, official statements, certificates and other documents; and upon preparation thereof, Company will submit such documents to City's governing body for appropriate action. (d) Assist City in obtaining ratings and approvals of bond rating agencies and to advise City of current bond market conditions, forthcoming bond issues and other general information and economic data which might normally be expected to influence interest rates or bidding conditions so that the date for the sale of the Municipal Securities can be set at a time which, in the parties' mutual opinion, will be favorable. (e) Assist City in acquiring qualified obligations for any escrow fund established in connection with any Municipal Securities refunding or refinancing. 3. If City authorizes the issuance and sale of the Municipal Securities, Company shall, in addition to the services set forth in paragraph 2 hereof, assist the City in the public sale of the Municipal Securities upon the following terms and conditions: (a) Company will assist in the preparation of an Official Notice of Sale and a uniform Bidding Form to be furnished by City in the quantity sufficient to permit mailing by City to a list of prospective bidders which will be developed by City and Company. (b) Company will arrange for necessary legal publications. (c) City will pay all expenses for the issuance of the Municipal Securities out of proceeds thereof or from mark -up in the interest rate to the investor. All expenses will be mutually agreed upon and approved by City's Director of Finance. Such expenses shall not include reimbursement for Company's travel, communication, lodging and meals within the State of Colorado or Company's costs and expenses of participation in the studies or preparation of plans under paragraph 2 hereof. (d) If an advertised public sale of Municipal Securities attracts no unconditional or otherwise acceptable bid proposals and the City nevertheless elects within ninety (90) days after the date bids are received to proceed with the issuance of said Municipal Securities as a negotiated underwriting or placement, Company shall be given the first option to either privately place or underwrite the sale of said Municipal Securities upon terms and conditions acceptable to City and Company. (e) The issuance and sale of Municipal Securities shall be accompanied by an unqualified bond counsel opinion and no- litigation certificates. City will undertake all disclosure requirements of Securities And Exchange Commission Rule 15c 2 -12. 4. For all services to be performed by Company hereunder, the City will pay Company an annual fee of $7,500 (prorated for the first and last calendar year). The annual fee will be paid in equal quarterly installments. 5. The term of this Agreement shall be thirty -six (36) months, commencing May I, -2- 1996 and ending April 30, 1999 and may be terminated by either party upon giving thirty (30) days prior written notice to the other party specifying the date of termination. Company understands and agrees that City's financial obligations under this Agreement for any fiscal year subsequent to fiscal year 1996 are subject to annual budgeting and appropriations therefor. 6. Company shall comply with disclosure and other requirements of Rule G -23 promulgated by the Municipal Securities Rulemaking Board, provided that (a) Company shall not acquire as principal either alone or as a participant in a syndicate or other similar account formed for the purpose of purchasing, directly or indirectly, from the City all or any part of a Municipal Security with respect to which Company has provided financial advisory services, nor arrange for such acquisition or participation by a person controlling, controlled by, or under common control with Company, nor act as agent for City in arranging the placement of such Municipal Security. (b) Company shall not deposit City funds including proceeds of any Municipal Security with or utilize fiduciary or agency services offered by Company or by a person controlling, controlled by, or under common control with the Company in connection with the rendering of financial advisory services under this Agreement. (c) In the event of a conflict between any other provision of this Agreement and any provision of this Section 6, the provision of this Section 6 shall control. 7. Unless otherwise directed by Resolution of the City Council of City, this Agreement shall be applicable to all Municipal Securities issued and sold by the City on or after May 1, 1996, except Municipal Securities issued and sold pursuant to request by the Board of Water Works of Pueblo, Colorado under Section 15 -2 of the Charter of the City and the $12,850,000 City of Pueblo, Colorado Limited Tax General Obligation Bond Series 1996 (HARP Bonds). 8. Financial advisory services required by the City in connection with any Municipal Securities litigation or other dispute arising out of a Municipal Securities transaction or offering are not included within the scope of financial advisory services under this Agreement. 9. This Agreement constitutes the entire understanding and agreement of the parties and may not be amended or modified except by written instrument signed by both parties. 10. This Agreement shall be construed and applied in accordance with Colorado law and shall be binding upon and inure to the benefit of the City and Company and their respective successors and assigns, provided Company may not assign this Agreement without the prior written consent of City. 11. The person executing this Agreement on behalf of Company represents and warrants that such person and Company are authorized to execute and deliver this Agreement and that this -3- Agreement constitutes the valid and legally binding obligation of Company and is enforceable against Company in accordance with its terms. Executed the day and year first above written. PUEBLO, A MUNICIPAL CORPORATION B . Presid t of the ity Council PRINCIPALFINANCIAL SECURITIES, INC. By Title: -�!�� IEAH FIRST AMENDMENT TO AGREEMENT FOR FINNANCIAL ADVISORY SERVICES THIS FIRST AMENDMENT TO AGREEMENT FOR FINANCIAL ADVISORY SERVICES is entered into as of \ \ September , 1996 (this "Amendment "), by and between the City of Pueblo, Colorado, a duly organized municipal corporation, and Principal Financial Securities, Inc., \ \(the "Company "). WHEREAS, the City and the Company previously entered into an Agreement For Financial Advisory Services, dated as of May 1, 1996 (the "Financial Advisory Agreement "), which provides that the Financial Advisory Agreement shall be applicable to all municipal securities issued by the City during the three -year term of the Financial Advisory Agreement, except for certain exceptions and unless otherwise directed by Resolution of the City Council; and WHEREAS, the City Council has determined that, due to lower interest rates and resulting debt service savings, it is in the best interests of the residents of the City for the City to issue sewer revenue refunding bonds (the "Bonds ") to refund on a current basis the City of Pueblo, Colorado, Sewer Revenue Refunding Bonds, Series 1996, currently outstanding in the aggregate principal amount of $11,195,000; and WHEREAS, the City Council has determined and directed through the adoption of Resolution No. 73Z3on \ \ August 12 , 1996, that, in the best interests of the residents of the City, the Bonds should be sold by the City to the Company on a negotiated basis, after authorization by an Ordinance, rather than offered for public sale on a bid basis; and WHEREAS, Rule G -23 of the Municipal Securities Rulemaking Board requires in such a situation (a) that a financial advisor such as the Company must make certain disclosures concerning (i) possible conflicts and (ii) the source and anticipated amount of all remuneration it will receive for underwriting the Bonds and (b) and that an agreement be signed to except the municipal securities being sold on a negotiated basis from the Financial Advisory Agreement: and WHEREAS, the Company has made the disclosures required by Rule G -23 in writing to the City: and WHEREAS, the Citv acknowledges receipt of the disclosure by the Company of possible conflicts between its role under the Financial Advisory Agreement and its role as underwriter of the Bonds. as well as the disclosure of the source and estimateLLl amount of all of its remuneration to be received in connection with underwriting the Bonds. WHEREAS, \ \ the Company previously has made presentations to the City concerning the issuance of the Bonds by the City, showing the potential savings to be derived from such a current refunding; and WHEREAS, the City and the Company desire to except the sale of the Bonds from the provisions of the Financial Advisory Agreement; NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements contained herein, the City and the Company agree as follows: 1. Section 7 of the Financial Advisory Agreement is hereby amended and restated to read, after such amendment, as follows: 7. Unless otherwise directed by Resolution of the City Council of City, this Agreement shall be applicable to all Municipal Securities issued and sold by the City during the term of this Agreement on or after May 1, 1996, except Municipal Securities issued and sold pursuant to request by the Board of Water Works of, Pueblo, Colorado under Section 15 -2 of the Charter of the City, the $12,850,000 City of Pueblo, Colorado Limited Tax General Obligation Bond Series 1996 (HARP Bonds), and the issue of approximately $12,000,000 aggregate principal amount of the City's Sewer Revenue Refunding Bonds, Series 1996. 2. Other than the amendment made pursuant to Section 1 hereof, the remaining provisions of the Financial Advisory Agreement are hereby confirmed as they exist. 3. This Amendment constitutes the entire understanding and agreement of the parties as to an amendment of the Financial Advisory Agreement. Executed as of the day and year first written above. CITY OF PUEBLO, COLORADO, A Municipal Corporation By Pr ident of City ouncil PRINCIPAL FINANCIAL SECURITIES, INC. By Senior Vice President