Add-onTo:
Via:
From:
Date:
The Honorable Mayor & Members of the City Commission
Buford R. "Randy" Witt, Acting City Manager
Alfredo Riverol, Finance Director
September 7, 2010
Agenda Item No.: Abb 0"
A Resolution of the Mayor and City Commission of the City
of South Miami, Florida, authorizing the Acting City
Subject: Manager to hire FirstSouthwest as the City's Financial
Advisor to analyze the City's financial position with respect
to bond re- financing; and providing an effective date.
The city attorney believes that time is of the essence and
that it is in the best interest of the City to retain a Financial
Advisor and has recommended the services of
Background: FirstSouthwest to analyze the City's financial position with
respect to bond re- financing of the parking garage bonds.
Attached FirstSouthwest Engagement Letter (pending review and
Documentation: approval by the City Attorney and proof of the required
insurance.)
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RESOLUTION NO.
A Resolution of the Mayor and City Commission of the City of
South Miami, Florida, authorizing the Acting City Manager to
hire FirstSouthwest as the City's Financial Advisor to analyze the
City's financial position with respect to bond re- financins; and
providing an effective date.
WHEREAS, the city attorney believes that time is of the essence and that it is in
the best interest of the City to retain a Financial Advisor and has recommended the
services of FirstSouthwest to analyze the City's financial position with respect to bond
re- financing; and
NOW THEREFORE BE IT RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF SOUTH MIAMI, FLORIDA;
Section 1. That the City Commission hereby authorizes the Acting City
Manager to engage in an agreement with FirstSouthwest as the City's Financial Advisor
to analyze the City's financial position with respect to bond re- financing, pending review
and approval of the engagement letter by the City Attorney.
Section 2. That the City Commission hereby approves the attached
engagement from FirstSouthwest dated September 7, 2010, and annexed to this
Resolution as Exhibit A, pending review and approval of the engagement letter by the
City Attorney.
Section 3. This resolution shall take effect immediately upon adoption.
PASSED AND ADOPTED this day of 2010.
ATTEST:
CITY CLERK
READ AND APPROVED AS TO FORM
AND SUFFICIENCY:
CITY ATTORNEY
Page 1 of 1
MAYOR
COMMISSION VOTE:
Mayor Stoddard:
Vice Mayor Newman:
Commissioner Palmer:
Commissioner Beasley:
Commissioner Harris:
Additions shown by underlinin¢ and deletions shown by o°^�° ing.
First®test
A PlainsCapital Company,
18851 NE 29th Avenue
Suite 520
Aventura, FL, 33180
(305) 819 -8886 Direct
(305) 819 -9995 Fax
September 7, 2010
Mr. Alfredo Riverol
Finance Director
City of South Miami
6130 Sunset Drive
South Miami, FL 33143
Dear Mr. Riverol:
Edward Marquez
Senior Vice President
edward.mwquez@fistsw.com
On behalf of First Southwest Company (FirstSouthwest), I thank you for the opportunity to serve the City
of South Miami as its Financial Advisor. Please let this letter confirm the terms of our engagement.
Scope of Services
The requested financial advisory services under this engagement may include, but is not limited to,
providing the City with the following:
➢ Review of the City's current debt covenants and debt ratio;
➢ As needed financial advice regarding market conditions and trends, financial products, credit and
credit analysis, third party alternative financing and special facility financing;
➢ Analyses and evaluations of potential refunding and new money issues;
➢ Analysis and evaluations of proposed bonds or long -term loans;
➢ Review and evaluation of financing options, derivative and other innovative products, financial
feasibility studies, legal documents, and pricing of any financing and any escrow;
➢ Participation in rating agency presentations and preparations of official statements; and
➢ Other financial services as requested.
Engagement Duration
The engagement will be for a one -year period from the date of acceptance below. The engagement may
be renewed for two additional one -year periods at the option of the City.
Compensation
See Exhibit I attached for the terms of compensation.
Please indicate your acceptance of these terms by your signature below. I and the entire FirstSouthwest
team, look forward to serving the City.
Sincerely yours, Accepted:
Edward Marquez By:
Senior Vice President
Date:
Exhibit I
Compensation for Services Rendered
A. With regard to the financial advisory services described herein, other than in connection with a
transaction, please propose the amount of your proposed fee on a fixed annual cost, payable
monthly.
FirstSouthwest proposes a flat fee of $60,000 per year for other than transactional work. Alternatively, we can also
propose the City pay a monthly retainer for non- transactional work of $2,100 per month and be billed for any hours
in excess of ten hours of effort in that month at the hourly rates specified in section `B.' below.
B. With respect to additional agreed upon services that may be best performed on an hourly basis,
please provide your proposed compensation on a time and expense basis, with a list of hourly billing
rates for the firm and any proposed increases in rates during the term of the contract, and the types
of reimbursable expenses with proposed charges.
Clerical/Support $90 $50
These rates include all expenses except for outside the travel as requested by the City at rates authorized by Florida
Statute, mileage reimbursement, tolls, FedEx/UPS charges, conference calls with call -in numbers and any
extraordinary copying of presentational material.
C. With regard to financial advisory services performed in connection with a bond, commercial paper or
derivative transaction, please describe your proposed manner of billing (e.g. per bond fee, fee per
$1,000 of notional amount) for each type of transaction and the amount of your proposed fee for such
transactions to be paid on a contingent basis for specific financing issues.
For all debt transactions, FirstSouthwest proposes a transactional fee i'i of
Amount of Debt Issued Fee
For thefirst $10,000,000 $17,500
For the next $10,000,000 $1.00 per $1,000
For the next $20,000,000 $0.80 per $1,000
Greater than $40,000,000 $0.70 per $1,000
(oMinimum $17,500 per transaction.
FirstSouthwest
City of
Standard Rate
South Miami
Position
(per hour)
Discounted Rate
(per hour)
Senior Vice President and Above
$350
$210
Vice President
$275
$190
Assistant Vice President
$225
$150
Analyst/Associate
$190
$125
Clerical/Support $90 $50
These rates include all expenses except for outside the travel as requested by the City at rates authorized by Florida
Statute, mileage reimbursement, tolls, FedEx/UPS charges, conference calls with call -in numbers and any
extraordinary copying of presentational material.
C. With regard to financial advisory services performed in connection with a bond, commercial paper or
derivative transaction, please describe your proposed manner of billing (e.g. per bond fee, fee per
$1,000 of notional amount) for each type of transaction and the amount of your proposed fee for such
transactions to be paid on a contingent basis for specific financing issues.
For all debt transactions, FirstSouthwest proposes a transactional fee i'i of
Amount of Debt Issued Fee
For thefirst $10,000,000 $17,500
For the next $10,000,000 $1.00 per $1,000
For the next $20,000,000 $0.80 per $1,000
Greater than $40,000,000 $0.70 per $1,000
(oMinimum $17,500 per transaction.
In addition, FirstSouthwest will act as sole bidding agent for the structuring and investment of certain debt
instrument proceeds. FirstSouthwest agrees to structure and conduct all bids for any of the funds authorized by the
debt instrument documents and to comply with Treasury Regulation 1.148 -5 that applies to computing the yield and
value of such investments and determine required documentation. The successful investment provider shall pay
FirstSouthwest a fee equal to 0.05 percent of the weighted average dollar amount reasonably expected to be invested
each year of the investment. agreement. The fee paid by the winning provider will be the only compensation received
by FirstSouthwest in connection with its engagement of a bidding agent.
The payment of charges for financial advisory services for debt transactions shall be contingent upon the delivery of
the debt instruments and shall be due at the time that the debt instruments are delivered. The payment of charges for
other services shall be due and payable in accordance with the mutual agreement between FirstSouthwest and the
City.
The City shall be responsible for the following ancillary expenses, if and when applicable, whether they are charged
to the City directly as expenses or charged to the City by FirstSouthwest as reimbursable expenses:
• Bond counsel
Verification (CPA) fees for refunding
• Disclosure counsel
Official statement preparation and printing
• Bond printing
Paying agent/registrar /trustee
• Bond ratings
Travel expenses
• Computer structuring
Underwriter and underwriters counsel
• Credit enhancement
Miscellaneous, including copy, delivery, and phone charges
The charges for ancillary expenses, including computer structuring and official statement printing, shall be levied
only for those services which are reasonably necessary in completing the transaction and which are reasonable in
amount, unless such charges were incurred at the specific direction of the Issuer.
The payment of reimbursable expenses that FirstSouthwest has assumed on behalf of the Issuer shall NOT be
contingent upon the delivery of bonds and shall be due at the time that services are rendered and payable upon
receipt of an invoice therefore submitted by FirstSouthwest.