Ordinance No. 11,838ORDINANCE' NO. 11,838
I
AN ORDINANCE OFTHE CITY COUN( , IL CSI., TI IF', CITY OFBAYTOWN,41,"XAS,
AUTHORIZING '171-11-1' CITY MANAG1,1`R TO NE'(30TIATE AND fIXECUTE AN
F,ING AGEMENT LETTER WITH BRACEWELL & 611,J ,IANI, LI-13, TO I)ERFORM
LEGAL SERVICES AS THE CITY'S BOND COUNSt, ' 1, AND TO TAKE
APPROPRIATE ACTION TO TRANSIJ.-.R THE CITY'S FILES, RECORDS, AND
DOCUMENTS FROM VINSON & E'LKINS, LLP,TO BRACEWELL & GIULIANI, LLP,
AND APPROVING SIMILAR ACTION TO BETAKEN BY TI IF BAYTOWN AREA
WATI:,"R AUTHORITY; AND PROVIDING FORTI- II. 'Ef , FECTIVE DATE 'ITIEREOF,
4, * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *t.* ** * * * * * * * * * * * * * * * * * * * * ****** * * * * *44* * * * * * * * * 1, * * * *
BE IT ORDAINE D BYTH1,CITY COUNCIL OF TI IE CI'YY OF BAYTOWN, TEXAS:
Section 1: That the City Council of the City of Baytown, Texas, hereby authorizes the City
Manager to negotiate and execute all engagement letter with Bracewell & Giuliani, LLI1, to perforni legal
services as the City's bond counsel and to take appropriate action to transfer the City"s files, records, and
documents from Vinson & Elkins, LLP, to Bracewell & Giuliani, 1.1-P. Such agreement shall be Linder
terms and conditions acceptable to the City Manager and the City Attorney.
Section 2: That the City COUncil of the City of Baytown,'"I'exas, hereby approves similaractioll
as specified in Section I hereof to be taken by the Board o f Directors of the Baytown Area Water Authority
Linder terms and conditions acceptable to its General Manager and its General Counsel.
Section 3: This ordinance shall take effect immediately f•orn and after its passage by the C, I
ity
Council ofthe City of Baytown.
INTRODUCFID, READ and PASSED by (lie aff-ii-mative vote
Baytown this the 12"' day of January, 2012.
APPROVED AS TO FORM:
14�NACIO RAMIREZ, SR,, it Attorney
V\(: °obf "s,t) I Cound,,0rdinances\20 I 2%.1anuu)! 12\11ondCounsel
the City Council of the City of
1-1. DONCARLOS,
Texas Jonathan K.Frels
New York Partner
Washington, DC
Connecticut 713.221.1599 Office
Seattle 713.221.1212 Fax
Dubai
London Jonathan.Frels@bgllp.com
Bracewell&Giuliani LLP
711 Louisiana Street
Suite 2300
Houston,Texas
77002-2770
January 25, 2012
Mr. Bob Leiper
City Manager
City of Baytown, Texas
P. O. Box 424
2401 Market Street
Baytown, TX 77522
Re: Engagement Letter—City of Baytown, Texas
Dear Mr. Leiper:
Thank you for engaging us to represent the City of Baytown, Texas ("City" or "Client") as
bond counsel. We appreciate the confidence you have shown in Bracewell & Giuliani LLP
("B&G"or"Firm")and look forward to this opportunity to represent your interests.
It is our practice to confirm the terms and conditions of our engagements, and that is the
purpose of this Engagement Letter and the attached Terms of Engagement. This engagement
has been approved by B&G subject to the conditions described in this letter.
Scope of Engagement
B&G will represent the City in connection with its issuance, from time to time, of bonds,
certificates of obligation, tax notes and other debt obligations ("Obligations"), including its
General Obligation and Refunding Bonds, Series 2012 ("Bonds").
We agree that our services as bond counsel will include the following:
1. Attendance at all meetings of the City Council as required or requested in
connection with the planning and authorization of Obligations, including
consultation on federal income tax matters;
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City of Baytown, Texas
January 25, 2012
Page 2
2. Preparation of bond election ordinances, as necessary, and assistance with
filing or necessary preclearance letters with the U.S. Department of Justice;
3. Preparation of the ordinances of the City Council authorizing issuance of
Obligations, together with all other legal documents comprising the transcript
of proceedings for authorization and issuance of Obligations;
4. Preparation of and submission to the Attorney General of Texas of a transcript
of proceedings for each series of Obligations to obtain the approval of the
Attorney General and registration of Obligations by the Comptroller of Public
Accounts of Texas;
5. Preparation and filing of legal documents required under federal income tax
law for the Obligations, and the preparation of and delivery to the City of a
Letter of Instructions with respect to the federal income tax treatment of
Obligation proceeds;
6. Representation of the City at the closing of the sale of Obligations, including
preparation of all closing documents; and
7. If appropriate, the delivery at closing of our approving opinion as to the
validity of the Obligations under Texas law, and the exclusion of interest on
the Obligations from gross income of the holders under federal income tax
law.
The services outlined above do not include such matters as services as disclosure counsel in
connection with the sale of the Obligations, work on post closing federal tax or disclosure
issues, obtaining IRS rulings or clarifications of federal tax law, presentations to rating
agencies or bond insurers, or "blue sky" or securities registration services. We will be
pleased to provide legal services in connection with any matters not included in paragraphs 1
through 7 above, but we believe that such additional services, if requested by the City, should
be the subject of an addendum to this letter or a separate letter of engagement. Our
representation of the City with respect to any particular series of Obligations will end upon
the closing for that particular series of Obligations.
This Engagement Letter may be supplemented, in writing signed by both parties, to reflect
new matters or issues that deviate from the current engagement in scope, billing
arrangements, complexity, risk, or that otherwise require a substantial change in terms and
conditions. The Terms of Engagement, however, will govern all projects and engagements
for Client.
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City of Baytown, Texas
January 25, 2012
Page 3
Fees, Expenses and Billing
For our services in connection with the City's issuance of its Bonds, our fee will be
$25,500.00 and will be payable from the proceeds of the Bonds. Our fee, therefore, is
contingent on the actual sale and delivery of the Bonds. If the Bonds are not issued, no fee
will be due. Fees for additional and future services will be determined by mutual agreement
of the City and B&G.
Transition and Transfer of Files
As you are aware, attorneys representing the City will be transferring to B&G from Vinson&
Elkins LLP ("V&E") prior to the closing of the City's issuance of its Bonds. As a result,
B&G and V&E will share the fee for services rendered in connection with the Bonds. The
City will receive a single invoice from B&G at the conclusion of the transaction, and the City
will not receive an invoice from V&E. Any amounts owed to V&E in connection with the
Bonds will be handled between the respective firms based on the relative proportion of
services performed by the respective firms, taking into account both relative time spent and
the specific responsibilities of each firm.
Client will not pay duplicate fees or expenses, and amount paid to V&E will be credited to
the appropriate account.
By executing this Engagement Letter, you are authorizing the transfer of all physical and
electronic files, records and documents for all active and inactive matters from V&E to B&G.
Conflicts of Interest: Applicable Standard
For purposes of evaluating conflicts of interests, you acknowledge that B&G relies upon the
Texas Disciplinary Rules of Professional Conduct. B&G may represent other clients that
may be adverse to your interests in substantially unrelated matters, and it may represent other
clients within the same industry.
Conclusion
You are encouraged to discuss the terms of this engagement letter with the independent
counsel of your choice. Please call me if you wish to discuss any aspect of this engagement.
If this Engagement Letter, including the provisions in the attached Terms of Engagement,
correctly reflects your understanding of the terms and conditions of our representation, please
sign the enclosed copy of this letter in the space provided and return it to me.
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City of Baytown, Texas
January 25, 2012
Page 4
Thank you again for the opportunity to represent you in this matter.
Very truly yours,
Bracewell & Giuliani LLP
Name• o a K. rel
Attachments
AGREED AND ACCEPTED:
City of Baytown, Texas
By: /01--/--,.. 'Its: eiyy fY(athct,B r"
Date: /-a 7 /?
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C,
BRACEWELL & GIULIANI LLP
TERMS OF ENGAGEMENT
Introduction
These are the Terms of Engagement adopted by Bracewell & Giuliani LLP ("B&G") and the
addressee of the preceding Engagement Letter ("Client") and referred to in our Engagement
Letter as the basis for our representation. Because they are an integral part of our agreement to
provide representation, we ask that you review this document carefully and retain it for your
files. If you have any questions after reading it, please promptly inform your principal contact at
the Firm.
Client of the Firm
Because B&G has been engaged to represent the Client only, the engagement does not include
the Client's family members, affiliated or related entities, or their respective individual officers,
directors, partners, equity owners or employees.
Unless otherwise specifically stated in the Engagement Letter, our representation does not
include any parent, subsidiary, or affiliated entity; employee, officer, director, shareholder,
member or partner of an entity; or, any commonly owned entity. For any trade association, our
representation does not include any member of the trade association; and for individuals, our
representation does not include any employer, partner, spouse, sibling, or other family member.
In the event we are asked to undertake representation of any other entity in connection with this
engagement, we will do so only by agreement defined in the Engagement Letter. By execution
of the Engagement Letter, Client consents to B&G's use of the name and a generic description of
the transaction in B&G marketing materials. Confidential Client information will not be
included in such materials.
Our Relationship with Others and Conflicts of Interest
Conflict of Interest is a concern for B&G and its clients. We attempt to identify actual and
potential conflicts at the outset of each engagement. Unfortunately, conflicts sometimes arise or
become apparent after work begins on an engagement. When that happens, we will do our best
to address and resolve the situation in the manner that best serves the interests of all of our
affected clients.
If a Conflict of Interest unrelated to this engagement develops between you and another client of
B&G, you consent to the firm's adverse representation in the unrelated matter.
B&G accepts this engagement on the understanding that our representation of you will not
preclude us from accepting another engagement from a new or existing client provided that
(1) such engagement is not substantially related to the subject matter of services we provide to
you and (2) such other engagement would not impair the confidentiality of related client
information.
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Staffing the Project
In most cases, one attorney will be your primary contact. In order to provide you with the
expertise of our firm, and to provide services on a cost effective basis, that attorney will delegate
parts of your work to other lawyers, paralegals and professionals.
Third-Party Vendors & Consultants, Experts, Etc.
It may be necessary for us to retain third parties, such as consultants, experts and investigators,-in
order to represent you adequately. In that event, upon Client's written approval, you will be
responsible for the prompt payment of the invoices of those third parties.
Taxes
The Client agrees that all payments under the Engagement Letter shall be payable to B&G in
U.S. Dollars, free and clear of any and all present and future taxes, levies, imposts, duties,
deductions, withholdings, fees, liabilities and similar charges (the "Taxes"). If any Taxes are
required to be withheld or deducted from any amount payable under the Engagement Letter, then
the amount payable under the Engagement Letter shall be increased to the amount which, after
deduction from such increased amount of all Taxes required to be withheld or deducted
therefrom, will yield to B&G the amounts stated to be payable to B&G under the Engagement
Letter.
" Termination
Because B&G has been engaged to provide services in connection with the representation
specifically defined in our Engagement Letter, the attorney-client relationship terminates upon
our completion of those services.
You may terminate the engagement at any time, with or without cause, by notifying us in
writing. The firm also can terminate the engagement before the completion of its representation
of you in the specified matter if(a) the continued representation would result in a violation of the
applicable rules of professional conduct or other law; (b) you persist in a course of action that
B&G reasonably believes is criminal or fraudulent, or you have used our services to perpetrate a
crime or fraud, (c) the firm has a fundamental disagreement with the objective or tactics in this
engagement; (d) you deliberately and substantially fail to discharge an obligation regarding this
engagement, including the payment of fees and expenses and the duty of cooperation as provided
in the Terms of Engagement; or (e) other good cause for termination exist. In the event that the
firm intends to terminate the engagement, the firm will give reasonable notice and allow you
access to your files relating to this engagement.
For purposes of this Engagement Letter, this engagement terminates upon written notice of
termination by Client or by B&G.
The termination of our services will not affect your responsibility for payment of legal services
rendered and other charges incurred before termination and in connection with an orderly
transition of the project.
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After completion of the representation, however, changes may occur in the applicable laws or
regulations that could affect your future rights and liabilities in regard to the matter. B&G has no
continuing obligation to give advice with respect to any future legal developments that may
relate to the project.
B&G Files
You agree that B&G will own and retain its own files and any related electronically stored
information pertaining to the engagement. You will not have the right or ability to require us to
deliver such files and records (or copies thereof) to you, except as required by law. Examples of
B&G files and records are: firm administrative records, financial files and documents, time and
expense reports, personnel and staffing materials, credit and accounting records, electronic mail
correspondence (other than such correspondence which was sent to you by a member of our
firm) and internal lawyer's work product, such as drafts, notes, memoranda and legal and factual
research, including investigative reports prepared by or for the internal use of lawyers. Further,
at the discretion of the responsible partner for the project in question, we may destroy any such
documentation which is the property of B&G or any documentation which such partner
determines to be duplicative or unnecessary in all cases without having to obtain your consent.
Choice of Law
Because B&G performs legal services in a number of jurisdictions, for consistency and
predictability, the Client and B&G agrees that the Texas Disciplinary Rules of Professional
Conduct (found at www.texasbar.com or www.txethics.org) will govern all issues of legal ethics
and professionalism.
Disclaimer
We cannot guarantee the outcome of any matter. Any expression of our professional judgment
regarding your matter or the potential outcome is, of course, limited by our knowledge of the
facts and based on the law at the time of expression. It is also subject to any unknown or
uncertain factors or conditions beyond our control.
Either at the commencement or during the course of the representation, we may express opinions
or beliefs about the matter or various courses of action and the results that might be anticipated.
Any expressions on our part concerning the outcome of the representation, or any other legal
matters, are based on our professional judgment and are not guarantees.
By signing the Engagement Letter or otherwise indicating your acceptance of the Engagement
Letter, you acknowledge that B&G has made no promises or guarantees to you about the
outcome of the representation, and nothing in these Terms of Engagement shall be construed as
such a promise or guarantee.
Your Cooperation
To enable us to provide effective representation, you agree to: (1)disclose to us fully, accurately
and on a timely basis, all facts and documents that are or might be material or that we may
request; (2) keep us apprised on a timely basis of all developments relating to the representation
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that are or might be material; (3) attend meetings, conferences, and other proceedings when it is
reasonable to do so; (4) provide updated information for conflicts purposes, if necessary; and
(5)cooperate fully with us in all matters relating to the engagement.
Modification of Our Agreement
The Terms of Engagement reflect our agreement on the terms of all engagements, and are not
subject to any oral agreements, modifications, or understandings. Any change in these Terms of
Engagement must be made in writing signed by both B&G and Client.
In Conclusion
If you have questions or concerns, at any time, relating to the terms and conditions of this
engagement, the services or advice provided by B&G, or the fees and expenses reflected in the
invoices, please bring them to the attention of your principal contact at our firm, or B&G's
General Counsel or Managing Partner.
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