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ORDER N0. c56E7
RF'PROVAL. OF RENEWING CONTRACT WITH DAIN RAUSCHER
INVESTMENT SERVICES AS FINANCIAL ADVISORS
On this day the 3rd day of November-, 1'3'3B upon motion made by
Commissioner Let z, seconded by Commissioner^ Baldwin, the Court
unanimously approved by a vote of 4-0-0, to renew contract
with Dain Rauscher• Investment Services as Financial Advisors
and author-ize the County Judge to sign same.
COMMISSIONERS' COURT AGENDA REQUEST
PLEASE FURNISH ONE ORIGINAL AND FIVE COPIES OF THIS REQUEST AND DOCUMENTS
TO BE REVIEWED BY THE COURT.
MADE BY: Robert A. Denson OFFICE: County Jude
MEETING DATE: November 23. 1998 TIIv1E PREFERRED:
SUBJECT: (PLEASE BE SPECIFIC)
Consider and discuss renewing contract with Dain Rauscher Investment Services as
Financial Advisors.
EXECUTIVE SESSION REQUESTED: (PLEASE STATE REASON)
NAME OF PERSON ADDRESSING THE COURT:
ESTIMATED LENGTH OF PRESENTATION:
IF PERSONNEL MATTER -NAME OF EMPLOYEE:
Countv Judi e
Time for submitting this request for Court to assure that the matter is posted in accordance with Title 5,
Chapter 551 and 552, Government Code, is as follows:
Meeting scheduled for Mondays:
THIS REQUEST RECEIVED BY:
THIS REQUEST RECEIVED ON:

All Agenda Requests will be screened by the County Judge's Office to determine if adequate information has
been prepazed for the Court's formal consideration and action at time of CouR Meetings. Your cooperation will
be appreciated and contribute towazds you request being addressed at the eazliest opportunity. See Agenda
5:00 P.M. previous Monday.
Request Rules Adopted by Commissioners' Court.
November 18, 1998
County Judge requested this be put on the agenda. Mr. Rober! ($ob) V. Henderson of
Dain Rauscher will make presentation.
ROBERT V. H~NDERSON
Managing Director
INVESTMENT SERVICES
INVESTMENT BANKING
November 23, 1998
The Honorable Judge Denson
County Judge
Kerr County
700 Main Street
Kerrville, Texas 78028
I2E: Financial Advisory Contract
Dear Judge Denson:
Phone: (210)805-1118
Fa::(210)805-1119
Thank you for your support and the direction to proceed on your note financing.
Accordingly, I enclose three execution copies of a financial advisory contract. Please
execute, retain one copy for your files and return two copies to my office.
I look forward to working with you on this project and hope to wrap it up before your
term expires.
Sincerely,
~~
Robert V. Henderson
Managing Director
RVH/mjs
153Treeline Park, Suite 100 (210) 805-1100 Dain Rauscher Incorporated
San Antonio,TX 78209-1873 Fax (210) 805-1145 Member NYSE/SIPC
FINANCIAL ADVISORY AGREEMENT
November 23, 1998
The Honorable Judge and Members of the Commissioners Court
Kerr County
Kerr County Courthouse
Kerrville, Texas
Ladies and Gentlemen:
1. We understand that the Ken County (the "Issuer") will have under consideration from time to
time the authorization and issuance of obligations evidencing indebtedness (all such
obligations shall be refereed to as "Obligations") and that in connection with the issuance of
such Obligations you hereby agree to retain Dain Itauscher Incorporated ("DRI") to perform
professional services as your financial advisor in accordance with the terms of this financial
advisory agreement ("Agreement"). This Agreement shall apply to all Obligations that may be
authorized and/or issued or otherwise created or assumed from time to time during the period
in which this Agreement is effective.
2. To fulfill these duties as financial advisor, we agree to perform the following:
(a) We will conduct a review of the financial resources of the Issuer to determine the
extent of the boreowing capacity of the Issuer. This review will include an analysis of
(1) the existing debt structure in relation to sources of income projected by the Issuer
which may be pledged to secure payment of the Obhgations to be issued, and (2)
where appropriate, the trends (as estimated by representatives of the Issuer) of
assessed valuation, taxing power, and future financing needs. In the event revenues of
existing or projected facilities operated by the Issuer are to be pledged to repayment of
the Obligations then under consideration, the survey will take into account any
outstanding indebtedness payable from the revenues thereof, additional revenues to be
available from any proposed rate increases and additional revenues, as projected by
consulting engineers employed by the Issuer, if any resulting from improvements to be
financed by the Obligations under consideration. We will also take into account future
financing needs and operations as projected by the Issuer's staff and consulting
engineers or other experts, if any, employed by the Issuer.
(b) On the basis of the information and estimates developed through our review described
above and other information that we consider appropriate, we will submit written
recommendations with respect to a plan of finance for the issuance of Obligations that
will include (1) the date of issue, (2) interest structure (fixed or variable), (3) interest
payment dates, (4) a schedule of maturities, (5) early redemption options, (6) security
provisions, and (7) other matters that we consider appropriate to increase the
marketability of the Obligations.
(c) In order to assist you in selecting a date for the sale of the Obligations, we will advice
you of current conditions in the relevant debt mazket, upcoming bond issues, and other
general information and economic data which might reasonably be expected to
influence interest rates or bidding conditions.
(d) We understand that you have retained or expect to retain a firm of recognized
municipal bond attorneys, whose fees will be paid by you, who will prepare the
proceedings, who will provide advice concerning the steps necessary to be taken to
issue the Obligations, and who will issue an opinion (in a form standard for the
particulaz type of financing) approving the legality of the Obligations and tax
exemption of the interest paid thereon. In addition, one or more of the Bond
Attorneys, your counsel or counsel to the underwriters of the Obligations will issue an
opinion to the effect that the disclosure document does not contain an untrue
statement of a material fact or omit to state a material fact necessary in order to make
the statements contained therein, in light of the circumstances under which they were
made, not misleading (subject to mazket exceptions). We will maintain liaison with the
bond attorneys and other attorneys to the transaction and shall assist in all financial
advisory aspects involved in the preparation of appropriate legal proceeding and
documents.
(e) If it is necessary to hold an election to authorize the Obligations, we will assist in
coordinating the assembly and transmittal to the bond attorneys of information
provided by or on behalf of the Issuer that is requested by the bond attorneys in
connection with the prepazation of the documents evidencing the legal proceedings
that aze necessary to conduct the election.
(f) In connection with the issuance of Obligations, we will coordinate the prepazation of
the official notice of sale, the disclosure documents, the uniform bid form (containing
provisions recognized by the municipal securities industry as being consistent with the
securities offered for sale), and such other mazket documents which you may request
or we deem appropriate. We will submit all such documents for examination,
approval, and certification by appropriate officials, employees, and agents of the
Issuer, including bond attorneys. After such documents have been examined,
approved, and certified, we will mail certain of these documents (a copy of which shall
be submitted to the Issuer upon request) to a Gst of prospective bidders. We will also
provide copies of these documents to the purchaser of the Obligations in accordance
with the terms of the official notice of sale and bid form.
(g) We will make recommendations to the Issuer on the matter of credit rating(s) for the
proposed issue of Obligations. Upon the request of the Issuer, we will coordinate the
prepazation of information to be submitted to any rating agency. In those cases where
it is appropriate to present personally information to any rating agency, we will
arrange for such presentation.
(h) We will make recommendations to the Issuer as to the advisability of obtaining
municipal bond insurance or other credit enhancement, or qualifications for such
insurance or enhancement, for the Obligations and, when directed by the Issuer, we
will coordinate the preparation of such information as, in our opinion, is required for
submission to the appropriate company, institution or institutions. In those cases
where the advisability of personal presentation of information to the appropriate
company, institution or institutions, may be indicated, we will arrange for such
personal presentations. The premiums for said insurance, if deemed advisable, will be
paid by the Issuer if purchased directly or the underwriters if purchased as a bidder's
option.
(i) In connection with each competitive sale, we will (1) disseminate bidding and
disclosure information to prospective bidders, (2) where appropriate, organize such
meetings to present information relating to the Obligations, (3) assist prospective
bidders in submitting proper bids, (4) coordinate the receipt of bids (and good faith
checks where indicated), (5) advice you as the best bid, (6) advice you concerning the
acceptance or rejection of the best bid, (7) if a bid is accepted, coordinate the delivery
of and payment for the Obligations, (8) assist in the verification of final closing figures,
and (9) upon request, recommend (based on information provided by representatives
of the Issuer regarding the estimated timing of the application of the proceeds of the
Obligations) a program of temporary investment of such proceeds.
(j) We will (1) arrange for the printing of the Obligations, (2) submit the Obligations for
execution and impression of a seal, and (3) cause the Obligations to be delivered to the
Attorney General for approval and the Comptroller of Public accounts for registration.
The Issuer shall maintain ownership of the Obligations until they are sold and delivered
to the purchaser.
(k) In the event formal verification by an independent auditor of any calculations incident
to the Obligations is required, we will make arrangements for such services.
(1) We will attend any and all meetings of governing body of the Issuer, its staff,
representatives or committees as requested at all times when we may be of assistance
or service and the subject of the financing is to be discussed.
(m) After closing, we will deliver to the Issuer and the paying agent(s) definitive debt
records, including a schedule of annual debt service requirements on the Obligations.
3. While this Ageement is in effect, the Issuer agees (upon our request) to provide or cause to
be provided to us information relating to the Issuer, the security for the Obligations, and other
matters that we consider appropriate to enable us to perform our duties under this Ageement.
With respect to all information provided by or on behalf of the Issuer to us under this
Ageement, the Issuer agees to obtain certifications (in a form reasonably satisfactory to us)
from appropriate representatives of the Issuer as to the accuracy of such information and to
use its best efforts to obtain certifications (in a form reasonably satisfactory to us) from
representatives of other parties than the Issuer, where appropriate. The Issuer acknowledges
that we shall be entitled to rely on the accuracy and completeness of all information provided
by or on behalf of the Issuer. In the event that such information is inaccurate or incomplete,
the Issuer agees that it shall assume full responsibility (from any funds that are lawfully
available for such purpose) for all losses suffered by us as a result of the inaccuracy or
incompleteness of such information as set forth below.
4. The Issuer acknowledges that it is responsible for the contents of its disclosure document and
is subject to and may be held liable under federal or state securities laws for violations thereof,
including misleading or incomplete disclosure.
To the extent permissible by law, the Issuer agees to indemnify and hold us harmless against
any losses, claims, damages or liabilities, to which we may become subject under federal or
state securities laws or regulation, at common law or otherwise (including in settlement of any
litigation if such settlement is effected with the written consent of the Issuer), insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based
upon omission or alleged omission to state in the disclosure document a material fact required
to be stated therein or necessary to make the statements therein not misleading; and will
reimburse us for any legal or other expenses reasonably incurred by us in connection with
investigating or defending any such loss, claim, damage, liability or action.
5. All actions taken and all recommendations made by us in performing our duties under this
Ageement will be based on our best professional judgment with the goal of obtaining the
most favorable terms for the Issuer and is not a guarantee of result; provided that we ages to
indemnify and hold the Issuer harmless against any losses, claims, damages or liabilities to
which you may become subject by reason of, or as a result of our negligence or willful
misconduct; provided further that such losses, claims, damages or liabilities are not
attributable to the Issuer's own negligence or misconduct in carrying out its duties.
6. In consideration for the services rendered by us pursuant to this Ageement in connection with
the authorization, issuance, and sale of Obligations, the Issuer agees that our fee will be
computed as shown on the "Fee Schedule" attached hereto. Our fee and reimbursable
expenses shall become due and payable simultaneously with the delivery of the Obligations to
be the Purchaser except that our reimbursable expenses shall be payable monthly upon our
submission of a written statement. Our fees do not include and we will be entitled to be
reimbursed from the Issuer for the following costs: (a) the printing and distribution of the
notice of sale and disclosure documents and the printing of the Obligations, (b) the fees of the
bond attorneys, (c) fees for information included in the official statement, (d) fees of the rating
agencies or credit enhancers, (e) travel and communications in connection with obtaining a
rating or credit enhancement on the Obligations, attending the closing of any issue of
Obligations, or any other matter, (f) the registration of the Obligations, or (g) litigation, (if
any) in connection with the issuance of the Obligations.
7. In connection with Rule G-23 of the Municipal Securities Rulemaking Board, the Issuer
agrees that Dain Rauscher Incorporated may submit a bid (either independently or as a
member of a syndicate) for any issue of Obligations when offered for sale at competitive bid
and prior to submitting any such bid we shall obtain the Issuer's written consent to bid on the
particular issue of Obligations.
8. We will provide our advice and assistance as to the investment of certain proceeds from the
sale of the Obligations. However, it is acknowledged that the purchase and sale of securities
or other investments, at the request of the Issuer, whether such funds are for construction
purposes, reserve fund deposits, for ultimate use in defeasing outstanding obligations of the
Issuer, or represent an investment for any funds of the Issuer, do not constitute the rendering
of financial advisory services and are not subject to the terms of this Agreement. We will
charge our normal and customary commission for such purchase or sale transaction.
9. If, during the term of this Agreement, we are asked to serve as underwriter with respect to
any issue of Obligation of the Issuer to be sold on a negotiated basis, we will, by written
notice to, and consent by, the Issuer, terminate our obligations under this Agreement with
respect to that issue of Obligations. This Agreement wills stay in effect with respect to other
issued of Obligations of the Issuer for which we are not acting as underwriter.
10. Special Conditions: In addition to the terms and obligations herein contained, this Agreement
is subject to the following special conditions:
11. This Agreement shall be for a period of sixty (60) months from its date; however, this
Agreement may be terminated by either party upon ninety (90) days written notice.
12. This Agreement is submitted in duplicate originals. When accepted by you, it will constitute
the entire Agreement between you and ourselves for the purpose and consideration herein
specified. Your acceptance will be indicated by proper signatures of your authorized
representative on both copies and the returning of one executed copy to us.
Respectfully submitted,
DAIN RAUSCHER INC RPORATED
By '
Name Robert V. Henderson
Title Managing Director
ACCEPTANCE
ACCEPTED pursuant to motion adopted by the governing body of Kerr County on
November 23, 1998.
sy
Nam
Title
Attest:
By ~ r1'las
Name n ~
Title ', '
FEE SCHEDULE
In consideration for the services rendered by Dain ltauscher Incorporated, the Issuer agees that
our fee for each issue of Obligations will be as follows:
Base Fee -Airy Issue
Plus	
$12.50 per	$1,000 up to
Plus	
$11.50 per	$1,000 next
Plus	
$ 7.00 per	$1,000 next
Plus	
$ 4.75 per	$1,000 next
Plus	
$ 3,750
$ 250,000 or $ 6,825 for $ 250,000 Bonds
$ 250,000 or $ 9,750 for $ 500,000 Bonds
$ 500,000 or $13,250 for $1,000,000 Bonds
$ 1,500,000 or $20,375 for $ 2,500,000 Bonds
$ 2.75 per $1,000 next $ 2,500,000 or $27,250 for $ 5,000,000 Bonds
Plus
$ 1.50 per $1,000 next $ 5,000,000 or $32,500 for $10,000,000 Bonds
Plus
$1.00 per $1,000 over $10,000,000
Fees for advance refunding Obligations and/or other Obligations involving escrow ageements,
will be the fee schedule set out above plus ]0 percent, and, in addition to our Financial Advisory
fee, we will charge a computer fee to be negotiated on a case by case basis.
Dain ltauscher Incorporated will bill the Issuer at Closing for each issue of Obligations a net
amount which will include a fee calculated on the above schedule as well as costs and expenses,
where applicable, incurred on behalf of the Issuer for the bond attorneys (provided the Issuer has
requested that Dain Rauscher Incorporated serve as its agent in the payment of the bond attorneys
fee), preparation, printing, and distribution of the Notice of Sale, Official Statement, Uniform Bid
Form oc Private Placement Memorandum, independent consultants, information meetings, if any,
presentations to rating agencies or credit enhancers, rating fees and travel expenses, if any,
printing of Obligations, and all appropriate costs and expenses associated with the closing and
delivery of the Obligations.