HomeMy WebLinkAbout20031182.tiff CUSi CUSTOMIZE PART
Maw ,,...
MBIA Municipal Investors
Capital Strength. Triple-A Performance. Service Corporation
1700 Broadway, Suite 2050
Denver, CO 80290
Tel 888-637-2662/303-860-1100
www.mbia.com
April 25, 2003
Mr. Claud Hanes
Weld County Treasurer
1400 North 17th Avenue
Greeley, CO 80631
Dear Mr. Hanes:
Enclosed herewith are two copies of our investment advisory agreement, signed by Mary
Donovan. Please return one copy to MBIA after it has been executed by Mr. Long.
Yours very truly,
1 te.41. SI %—(C2Q__
David W. Lee, Jr.
Client Services Manager
303-864-7412
Enclosures MD14 David W.Lae,Jr
Client Services Manager
MBIA Municipal Investors
Sunrise Corporation
1700 Broadway,Suite 42050
Denver,CO 80290
888 637 2662
303 864 7412
Fax:303 860 0016
e-mail:david.lee@mbia.com
Awe Al- -1"(Z 00,2„2.
2003-1182
Ann Arbor Austin Denver New York Orlando San Diego
MBIA MUNICIPAL INVESTORS SERVICE CORPORATION
Investment Advisory Agreement— Non-Discretionary
This Agreement, dated as of the 1st day of May, 2003 (this "Agreement"), is by and between
MBIA Municipal Investors Service Corporation (the "Adviser") and Weld County, Colorado (the
"Client"). The parties agree as follows:
1. Appointment
The Client hereby appoints the Adviser as the investment adviser of those assets designated by
the Client (the "Advisory Account").
2. Duties of the Adviser
The Adviser shall invest the assets of the Advisory Account as directed by the Client in
accordance with the written investment objectives, policies and restrictions of the Client. The
Client shall provide the Adviser with an initial Investment Policy or list of authorized investments
which shall be incorporated in Exhibit A.
The Adviser will provide to the Client monthly a written report detailing transactions for the
period and an inventory of the investments in the Advisory Account. It is agreed that the
Adviser, in the maintenance of records, does not assume responsibility for the accuracy of
information furnished by the Client or any other person.
Any additional investment management services the Adviser shall provide to the Client are
listed in Exhibit B.
3. Non-Discretionary Authority
It is agreed that decisions concerning investments subject to this Agreement shall be made by
the Client's authorized representative with the assistance of the Adviser. The approval of the
Client is required prior to the execution of any investment transaction for the Advisory Account.
The Adviser, when expressly instructed by the Client, will buy or sell securities and place orders
for the execution of such transactions with or through such brokers, dealers, or issuers as the
Adviser may select, subject to approval by the Client.
4. Changes in Investment Policies or Assets in the Account
The Client is required to notify the Adviser promptly in writing of any modifications to the
investment objectives, policies or restrictions applicable to the Advisory Account. The Client
agrees to notify the Adviser promptly of any withdrawal of securities from the Advisory Account
initiated by the Client.
5. Allocation of Brokerage
When placing orders for the execution of transactions for the Advisory Account, the Adviser will
take into consideration not only the available prices but also other relevant factors such as,
without limitation, execution capabilities and safekeeping arrangements. The Adviser will
exercise good faith in obtaining the best price and execution for each transaction for the
Advisory Account.
6. Safekeeping and Custody
The Adviser will not have custody or possession of the assets of the Advisory Account of the
Client. The Client shall select and authorize a custodian bank or brokerage firm to hold the
assets of the Advisory Account in safekeeping for the Client. The Client shall be solely
responsible for all fees involved with any custodial arrangements.
CCY41C SL/`. dau
y ,,�v,Ta3
7. Fees
The compensation of the Adviser for its services under this Agreement shall be calculated and
paid in accordance with the Fee Schedule in Exhibit C, as the same may be amended from time
to time by mutual agreement of the Client and the Adviser.
8. Limitation of Liability
The Adviser will not be liable for any error in judgment or any acts or omissions to act except
those resulting from the Adviser's gross negligence, willful misconduct or reckless disregard of
its duties and obligations under this Agreement. Nothing herein shall in any way constitute a
waiver or limitation of any right of any person under the federal and state securities laws.
9. Services to Other Clients
It is understood that the Adviser performs investment advisory services for other clients. The
Client agrees that the Adviser may give advice and take action with respect to any of its other
clients which may differ from advice given, or the timing, or nature of action taken, with respect
to the Advisory Account.
10. Representations by the Client
The Client represents that the terms of this Agreement do not violate any obligation by which
the Client is bound, whether arising by contract, operation of law, or otherwise, and that this
Agreement has been duly authorized by appropriate action and is binding upon the Client in
accordance with its terms.
11. Acknowledgment of Receipt of Brochure (Form ADV Part II)
The Client hereby acknowledges receipt of the Adviser's Brochure (Form ADV Part II) at least
48 hours prior to the date of execution of this Agreement in compliance with Rule 204-3 of the
Investment Advisers Act of 1940 ("the Act").
12. Notice
All notices and other communications shall be deemed effective when received, in writing, at the
addresses appearing below. Receipt of written notice shall be presumed if mailed postpaid by
registered or certified mail, return receipt requested. Each party shall be entitled to presume the
correctness of such address until notified in writing to the contrary.
13. Termination; Assignment; Amendment
This Agreement may be terminated at any time by either party giving to the other at least thirty
(30) days' prior notice of such termination confirmed in writing. If any fees have been paid in
advance, the Adviser will refund to the Client a prorata share of the fee. No assignment, as that
term is defined in the Act, of this Agreement shall be made by either party without the consent of
the other. This Agreement may be amended or modified at any time by mutual agreement in
writing.
14. Counterparts
This Agreement may be executed in two or more counterparts, each one of which shall be
deemed to be an original.
15. Governing Law
To the extent federal law does not apply, this Agreement shall be construed in accordance with
and governed by the laws of the State of Colorado.
Page 2
16. Entire Agreement
This Agreement constitutes the entire agreement of the parties with respect to the management
of the Advisory Account. The Exhibits referenced herein are incorporated into this Agreement.
17. Term of this Agreement
The term of this Agreement shall be for the period May 1, 2003 to December 31, 2003. The
Client may elect to renew the Agreement upon notice to the Adviser for each of the years 2004,
2005, 2006 and 2007. The parties understand that Article X Revenue: Section 20 of the
Colorado Constitution (The Taxpayer's Bill of Rights) prohibits the Client from entering into any
multi-year financial obligation without advance voter approval or without adequate present cash
reserves pledged irrevocably and held for payment in all future years. Consequently, the Client
cannot as of the date of this Agreement obligate itself to the Adviser to pay for services with
funds other than funds appropriated for the current year. However, the Client has an option to
extend the contract for years 2004, 2005, 2006 and 2007 with all of the services contemplated
by the Agreement at the fees set forth in the Fee Schedule in Exhibit C, as the same may be
amended from time to time by mutual agreement of the Client and the Adviser. The Client may
exercise this option for each of these years any time prior to the end of the then current year by
giving the Adviser oral or written notice that it is so doing. By so exercising the option for any
year, the Client agrees that it will pay the Adviser all amounts due under this Agreement for its
services during that year. If the Client fails to exercise this option for additional years, then the
Agreement will automatically terminate as of the end of the prior year, and the Client will have
no obligation to pay the Adviser for services beyond that time, nor will the Adviser have any
obligation to provide services beyond that time.
18. No Waiver of Immunity
No portion of this Agreement shall be deemed to constitute a waiver of any immunities the
parties or their officers or employees may possess, nor shall any portion of this Agreement be
deemed to have created a duty of care which did not previously exist with respect to any person
not a party to this Agreement.
19. No Third Party Beneficiary Enforcement
It is expressly understood and agreed that the enforcement of the terms and conditions of this
Agreement, and all rights of action relating to such enforcement, shall be strictly reserved to the
undersigned parties and nothing in this Agreement shall give or allow any claim or right of action
whatsoever by any other person not included in this Agreement. It is the express intention of
the undersigned parties that any entity other than the undersigned parties receiving services or
benefits under this Agreement shall be an incidental beneficiary only.
20. Severability
If any term or condition of this Agreement shall be held to be invalid, illegal or unenforceable,
this Agreement shall be construed and enforced without such a provision, to the extent this
Agreement is then capable of execution within the original intent of the parties.
21. Independent Contractor
Advisor agrees that it is an independent contractor and neither it, nor any of its employees, will
become an employee of the Client as a result of the execution of this Agreement.
Page 3
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by
their respective representatives as of the date first above written.
Weld County, Colorado
APPROVED BY:
David E. Long (04/30/20 3) j"
Chairman, Board of Count a
Commissioners ATTEST: { '
WELD COUNTY Ct_EERI TTO `
ADDRESS: 1400 North 17th Avenue
BY.
Greeley, CO 80631 DEPUTY CLERK TO T ;g
MBIA Municipal Investors Service Corporation
BY: 74-7 49141PC----
Mary Donovan, CFA
Vice President
ADDRESS: 1700 Broadway, Suite 2050
Denver, CO 80290
Page 4
Exhibit A
Authorized Investments
Insert a copy of the Client's Investment Policy or a List of Authorized Investments that specifies
the types of securities, maximum maturity, credit ratings, diversification or percent of portfolio
limits, and any other specified guidelines.
Page 5
Exhibit B
Work to be Performed
MBIA-MISC will provide the following services to Weld County:
• Provide full-time non-discretionary management of Advisory Account.
• Develop and implement investment strategies for the Advisory Account that will enhance
portfolio performance under current and future market conditions within the parameters of
the County's investment policy and cash flow needs.
• Provide technical and fundamental market research, including yield curve analysis.
• Obtain and document competitive prices for securities transactions.
• Assist with trade settlements.
• Provide detailed monthly investment reports for the portfolio detailing securities holdings,
portfolio composition and sector analysis, portfolio return and weighted average maturity,
and daily transaction activity.
• Provide separate quarterly and annual portfolio performance reports.
• Review and update the County's investment policy.
• Review investment management procedures and portfolio documentation.
• Work with the County to develop and update monthly cash flow projections.
• Perform due diligence reviews of current and proposed broker/dealers.
• Evaluate safekeeping and custodial procedures and agreements.
• Monitor the creditworthiness of the County's financial institutions and investments in the
portfolio.
• Attend meetings with the County investment staff, investment advisory committee, and the
Weld County Commissioners upon request.
Page 6
Exhibit C
Fee Schedule for Investment Advisory Services
The annual fee for providing investment advisory services for Weld County is as follows:
Assets Annual Fee
Up to and including $50 million 12 basis points (.12%)
The next $20 million 11 basis points (.11%)
Amounts over $70 million 10 basis points (.10%)
The fees for investment advisory services are based on the average value (cost basis) of assets
under management. A pro rata portion of the annual fee (1/12) is billed each month based on
the average asset value of the portfolio for the month. The fee shall be payable upon receipt of
billing from the Adviser.
Page 7
Hello