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Home My WebLink About1980-05 Authorizing the Substitution of Government Securities held in the Colorado National Bank of Denvery ~ ~RESOL ~tON NO. Serles O~ 19$0 A RESOLUTION AUTE~ORIZING THE SUBSTITUTION OF GOVERNMENT~~ SECURITIES HELD IN THE COLORADQ NATIONAL BANK C)T' DENIER, DENVER, COLORADO, DEPOSITED IN AN ESCROW ACCOUNT PURSUFNT TO AN ESCROW At7REEMENT AET6VEEN THE TOWN OF VAIL AND T~iE BF'~P1K IN CONNECTION WITH AN ADVANCED REFU?~iDING Off' THE TOWN' S GFr3ERAL OBLIGATION BOrrDS, SERIES MAF,CH 1 , 1974, DATED MARCH 1 A 197~~ AND ITS GENERAL OBLIGATION BONDS, SERIES DECEMBE~t. ~, 1975 DATED DECEMBER 1, 1975; AUTHORIZING THE SUBSTITU~.~'ION OF UNITE~7 STATES GOVERNMENT SECURITIES IN SAID ESCROW ACCOUNT Ai~D PROVIDING OTHER DETAILS IN CONNECTSON THEREWITH. WHEREAS, the Town of Vail in the County of Eagle and and State of Colorado, ("Town"), is a political subdivision of the State, a body corporate and politic, and a home-rule Town pursuant to Article XX of the State Constitution, and Article 2 of Title 31, C.R.S. 1973, as amended; and WHEREAS, by final amended Ordinance No. 26, Series 1976, adopted on September 7, 1975, the Town authorized the issuance of its General Obligation Refunding Bonds in the principal amouint of $fi,345,000 dated November 1, 197b, and WHEREAS, the proceeds of said refunding bonds less certain sums representing expenses plus certain cash were used to purchase United States government obligations which were listed in Schedules I and II of the Escrow Agreement with the Colorado National Bank of .Denver, Denver, Colorado, ~"Bonds") dated November 1, 1976, sufficient to pay the principal and interest on the bonds to be refunded; and WHEREAS, because of market conditions the United States Government securities now on hand in the Escrow Account may be sold and other suitable higher interest-bearing United States Government securities substituted therefor thus allowing the Town to realize substantial gain in interest earned by the substitute securities in the Escrow Account; and 2_ 4 6di~E~2EAS, the pr~ ~t Federal Regu;.ati.ons dc~ ~t prohibit.suclf an sut~stitution; and W~iEF~E~S, the x`awn Council determines it necessary and adviseable to ame~id the escrow agreement Gated November 1, '~ 976 by the sut~stitut~i.on of the United States Govern3-nent Securities listed ?.z- ~,ch~:F~ule A hereto attached and made a part hereof. NOT~T, THEREFORE, BE IT RE50LVED; Section 1. That Section 1 the escrow agreement dated November 1, 1976, between the Town of Vail, Eagle County, Colorado, and _G,a,lorado National Bank of Denver., Denver, Colorado, be and the same is hereby amended to per7it the substitution of the united States Government Securities listed in Schedule A attached hereto ancl_made a part hereof for the securities listed in Schedules I and II of the Escrow Agreement, such substitution may be made regardless of whether the securities are designated in the Escrow Agreement as bea.ng a part of the Portfolio A Account or the Portfolio B Account. Section 2. That the officers of the Town are authorized to contract with the Bank for the substitution of the Securities and are further authorized to take all actions which will enable the Town and the Bank to accompl~.sh the purposes o£ this Resolution. Section 3. That the fees of the financial adviser, H.I.S., Inc and Dain Boswort~i,~Inc., and-other associated cots for assisting the Town in purchasing the substitute securities and re-~computing the Escrow Account and its services in connection therewith are found to be reasonable and proper and are apportioned J nci.t....~o exceed $138,.750 0~ .th.e.~ma.jor portion and $.~6~250 0~ ,the minor portion. Section 4. That if any one or more section or part of this Resolution shall be adjudged unenforceable or invalid, such judgment shall not affect, impair, or. invalidate the remaining provisions of this Resolution, it being the intention that the various provisions hereof are severable. 3 -~ ectian 5. All Resol~itions or par-i-.s therefjE a.n con.f.lict with this Resolution a~:e hereby repealed. AUOPTE~} AND APPROVED this ~2 day of March, 1980. S ./ Marro r S E .A L ) . ATTEST: Tow~i C1Erk Thereupon, it was moved by Councilman .~L~.~' y~c~'~ ~~ and seconded by Councilman ~~~~ that the above Resolution be Placed on its final. passage and that all rules of the Council. which might prevent, unless suspended, the f~.nal passage and adoption of Resolution No. ,~, Series 1980, at this meetzng be and the same are hereby suspended. The question being upon the adoption of the motion and the Suspension of the rules the role was called with the following results: Those voting YES: Mayor: Rodney E. Slifer Councilmen: John Donovan Scott Hopman Bill. TrTilto Dr. Thomas Steinberg Paula Palmateer Ronald Todd Those voting NO: ~} (~-~.,~ Thf~ pres~.ding of~ :r thereupon declared that majority of the memE~er~hip of the entire Counci3, hava.ng voted in favor thereof, the said motion F~as ~~arried and t~ne sa~.d resolution No. 5 Series of 1934, dul~° passed and adopted. After taking up other business to come before the Council, the meeting was thereupon adjourned, RESOLIITION APPROVED AND ADOPTED this ,1.`~~ day of March, 1980. Mayor (/ S E A L) ATTEST; V( G ~~ Town Clerk S_ S'1~T,ti`1'F OF GOLUg2AD0 ) CGUNTY OF FAGLE ) ss. Tt~'F~l OF MAIL ) 1, Colleen Kline, Town Clerk of the Town of Vail, Co]o~:ado, do hereby certify that the foregoing pages numbered 1 to 5, inclusive, constitute a true and correct copy of the record of proceedings of the Town Council of the Town of Vail, Colorado, taken at a special meeting of the Town Council held on ~l~G'( , the ~z--day of March, 19$0, insofar as said proceedings relate to the final passage and adoption of Resolution No. S , Series of 1980; and said original Resolution No. ,~ Series of 1980, has been duly authenticated by the signatures of the P~ayor, as presiding officer of the Council, and myse-lf, as Town Clerk of the Town. ZN WITNESS WHFR~OF, T have hereunto set my hand and affixed the seal of the Town, at Vail; Colorado, this /~~ day of March, 1980. G~~G~~ ~~!~ ~~~ Town Clerk 6- Han~n,Imhoff & Sanford, Inc. 624 Seventeenth Street Denver, Colorado 80202 303) 534-0221 March 12, 19$0 Mr. Rich Caplan, Town Manager Town of Vail 75 S. Frontage Road West P. D. Box 100 Vail, Colorado 81657 Dear Rich: S~ C xawn. was iw nnnP emrw gyn. Members Now Ycrk Sfnck Exchange, Inc. American Slock Exchange, Inc. (Associate) MEtlwesl Stack Exchange. Inc. It has been brought to our attention that your presently outstanding escrow, funded from the $6,345,000 General Obligation Refunding Bond Issue of November, 1976, can be replaced to effect a significant savings to the Town., By this agreement, we are proposing to serve as financial advisor to replace the state and local government securities presently existing with new higher yielding open market treasury securities. After ~~ issuing expenses have been paid, the savings available to the ~3 Town at Closing will be a minimum of ~~o~ ~ ~~ ~'~ o.~.v{S `1tSt ,~ i By this agreement, Hanifen, Imhoff & Samford, Inc. and Dain ~aQ: f14 ~ f Bosworth, Inc., (investment banking firms) are given the -~- exclusive right to restructure the existing escrow. The Town ' agrees to purchase the new treasury securities to be placed in the escrow from the investment banking firms. Any open market risk in the purchase of these treasury securities will be barn by the investment banking firms until the closing date of this escrow replacement. It is agreed that the investment banking firms will retain, on your behalf, recognized municipal bond attorneys, whose opinion shall accompany the restructured escrow. The investment banking firms shall also retain a nationally recognized firm of public accountants to verify the sufficiency of the new treasury escrow to pay principal and interest on the refunded bonds. The investment bankers will pay all related issuing costs of this escrow replacement to include bond attorney, certification, and all other costs relative to the restructuring of the Towns escrow. Denver • Glenwood Springs ~ Greeley • Fort Collins, Colorado Wichita, Kansas • Little Rock, Arkansas J Hanz~n. ~aho~`'& Samf~id, Inc. It is understood that the investment bankers will. be acting aS principal on their own behalf in the purchase and sale of treasury securities to the Town, and fully expect to realize a profit of approximately $150,000 after payment of expenses incidental to the transaction. In the event that the savings to the Town hereabove described cannot be attained, ar that the opinion of the tax counsel and the certified public accountants hereabove described are not rendered on or before the closing of this transaction, then both the invest- ment bankers and the Town shall be released from their obligations described in this letter of agreement provided, however, that the investment bankers shall remain liable for all reasonable expenses incurred in the pursuit of this transaction. Acceptance of this proposal shall be indicated by the investment bankers and the Town by the signatures of the appropriate parties in the spaces provided below. Respectfully submittdd, and HANI I OF MFORD, INC. Thomas R. Bishop DAIN BOSWORTH, INC. u~ l!~ r ~ ~~ ~. L~ Blake Lynch TRB/ka ACCEPTED for and on behalf this va ~~ day of ~/~;,:.~~ ATTE uT of the Town of Vail, Colorado 1.9$0. Town Manager f ~ /~~ Town Clerk r ~~ TO~YN OF j'~-~,, COLORADO 1976 GO REF,7NG BOND ISSUE PROPOSED ESCRO~Y SEC~iRiTIES REPLACEMENTS Securities to be Redeemed from Escrow* Maturity Type Yield 11-30-95 SLG's 7.73% 11-30-94 SLG's 7.71,% 11-30-93 SLG's 7.70% 11-30-92 SLG's 7.68% 11-30-91 SLG' s 7.6?% Total SLG~s to be Redeemed Estimated Redemption Penalty Accrued Interest from 11/30 to 3/20 Total Source of Funds Far Amount 90,000 670,000 490, 000 455,000 150,000 X,855,000 E 51,271} 38.465 1,842,194 The exact amount and maturity of securities to be redeemed is subject to market conditions and cash flow considerations at the approximate time of closing. Securities to be Purchased and Placed in Escrow Estimated Par Cost With Maturity Type Coupon Yield Amount Accrued Interest 02-15-95 Open Market 1.0 1 / 2%12.4%90 , 000 81,1.60 OS-15-94 Open Market 8 3/4%12.5%660 , 000 5X0 ,1.40 OS-15-93 Open Market 5/8%12.5%480,000 368,740 OS-15-92 Openhiarket 7 1l4%12.1%445,000 315,320 Total Estimated Cast o f Purch ased Securities 1,275,360 Total Issuing Expenses 185,000 Net Savings to Town at Closing $ 381,834 The exact par amount and maturity of securities to be purchased is subject to market conditions and cash flow conditions at the approximate time of closing. w • • • • • ~ •. ... I~ , TOWN OF VAIL, COLORADO 1976 GO REFUNDING BOND ISSUE PROPOSED ESCROW SECURITIES REPLACEbLEI~'TS Allocation of Issuing Expenses Major Minor S[•~uv-~Item Portion Portion Total ~-~ Bond Attorney $ .13,500 $ x,500 $ 18,000.: CPA Verification 7,500 2,500 10,000 Computer Expense 3,000 1,000 4,000 Trustee Fee 2,250 750 3,000 Subtotal Direct Expenses $ 26,250 $ 8,750 $ 35,000 ~' Financial Advisory Fees: Hanifen, Imhoff & Samford, Inc. Dain Bosworth, Inc. Coughlin & Company 37,5ao 37,500 37,500 12 , Sao 12,500 12,500 5o,ooa 50,000 50,000 Total Expenses c_ ~ v L ~ 1 ~ `1~ ti i 138,750 46,250 $185,000 ~I r v 1 y 11 ky '~.I'ur6~ ~}~ ~ ~y l', ~~ ~ r ~} O X 1 0 4 • V~ I ~, c a 1 o r a d o 8 1 6 5 7 • 3 El 3 4 7 6 5& '! 3 March 28, 1980- c U. S. Treasury Bureau of the Public Debt Divisa_on of Security Operations Washi~zgton, D. C. 20226 Attention: P~ax1 Hughes Re: Authorization of Town of Vail t Finance Director nca>^ Ms . I~ughes : This is to inform you that Stanley ~' ~ Bernstein .is no longea^ the F~.n~~.nce Director for the Town of 'Vail. z`l~e curr_c}~t f.~.~~ance dirc'cto,r is L~l~_1,'l~~a~-~ Pyka, w~io is authorized to request the redemption o~ State and ~~oca1 Government Series Securities ~'ox the Town. Sinc~.rely, Colleen M. Kline Town Clerk Si~~nature Certificate :_~- a~ William Pyka ' ~` ` Finance Director - Town o~ Vail State of Colorado Coun ~y of Fagle ~ ss Subscribed and sworn to befoare me this 28th day ofsMarch,1980 seal.) ~~':i~...~. ~~tf~'~ My Commission expires. Notary Public f,~y Comr~~~s~aa exr~ires Se t. ~,1~~ STATE OF COLORADO COUNTY OF EAGLE TOWN OF VAIL SS. y r~+~ V""x~ The Town Council of the Town of Vail, Colorado, met in regular session at the Town Hall, Vail, Colorado, on Tuesday, March 18, 1980, at 'J°~ p.m. There were present at said meet- ing the following: Present: Mayor: Rodney L. Slifer Other Council Members: John F. Donovan Absent: constituting all the members thereof. There were also present: Town Clerk: Town Attorneys Paula Palmateer Scott Hopman E.- William Wilto Dr. Thomas Z. Steinberg RY~~r~:~~ar ~~Cx~d Colleen Kline Lawrence C. Rider Mayor Slifer introduced the following resolution, which is as follows: •